TVS Logistics Services acquires US firm
 "TVS Logistics Services acquires US firm")
TVS Logistics Services Ltd, the third party logistics service provider and part of TVS Group, has announced acquisition of the US-based Wainwright Industries an end-to-end supply chain providing firm as part expansion its value-added capabilities.
While the initial payment for the acquisition would be Rs 25 crore, the total acquisition would be of Rs 50 crore, in which the rest would be payed in milestones over a period of two years based on financial targets met by the US firm, said senior official from TVS Logistics Services.
The acquisition would bring in an end-to-end supply chain capability to TVS Logistics, which could be delivered to Indian companies with international operations, said R Dinesh, managing director, TVS Logistics Services Ltd. It would provide service capabilities such as cross docking and sub-assembly for manufacturers, which would enable TVS Logistics to move up in the value chain system, he added.
Speaking about the company, David Robbins, president of Wainwright Industries said that the 65 year old family business is presently at $20 million revenues and is expected to go up to $100 million in next two years. TVS Logistics Services has announced that it will retain the existing management and David Robbins would continue to manage the business in US.
"From the capability point of view, we have completed all our acquisitions with WainWright, to provide end to end supply chain solutions. We might be looking at acquisitions for adding new markets or customers in future, but with the latest acquisition, we have covered almost all the capability requirements as of now," said Dinesh. It may be noted that the company has earlier acquired overseas firms like Rico in UK and Mesco in US, to bring in capabilities.
The company is now looking at setting up its presence in Turkey and expanding presence in Thailand and also contemplates on setting up operations in China, though it is still in a thought process. It is looking at bringing in value addition to logistics business, to grow. While logistics is a low margin business, value addition could increase the revenues of the services offered, he added. In February, this year, TVS Logistics acquired of UK-based Rico Logistics, with a total cost of acquisition cost of around Rs 100 crore. The acquisition is expected to help the company to achieve its target of $1 billion turnover by 2015 and will add new verticals, according to reports.
KKR, and Goldman Sachs has together invested Rs 268.8 crore (approximately $ 53 million during the time).
Of this, according to a company announcement at that time, KKR has agreed to invest Rs 242.4 crore (approximately $47 million). The investment of Goldman Sachs was an add-on investment to its infusion of fund in 2008 into the company.
Dinesh said that in the year FY13 the company has clocked in a revenue of around Rs 1,900 crore, in which a major share of the growth has come from overseas markets. Majority of the revenue is coming from the overseas business, he added.