Everstone Capital, an India-focused private equity funding entity with $1.5 billion (about Rs 8,300 crore) of assets under management across four funds, is understood to be aggressively looking to expand its portfolio in the logistics segment.
Two of its funds are investing in growth equity in Indian companies, another focuses on the real estate market and the fourth is for the logistics sector. According to investment bankers close to Everstone, it has recently concluded a due-diligence exercise on the Bangalore-heaquartered AS Group of Companies, one of the largest warehousing service providers for a range of consumer goods companies such as Hindustan Unilever, Britannia, ITC, Nestle and Pepsi, among others.
According to the sources, the AS Group has total warehousing capacity of four million sq ft, majorly in south India, besides a few places in north India. “As we understand, Everstone may be looking at a $50-million (about Rs 277 crore) investment in the AS Group. While the due-diligence has been completed, Everstone is expected to revert with a final structure for the deal, after which a decision will be taken. Most probably, Everstone may look at a significant stake in AS Cargo Movers, an arm of AS Group,” a banker close to Everstone told Business Standard.
Everstone did not respond to queries. AS Cargo would not comment. AS Carriers, another arm of the Group, had earlier raised private equity from Merrill Lynch.
Even as Everstone is looking at this space, another of its ventures, IndoSpace Logistics Parks, manages a $240-million (Rs 1,329 crore) fund which closed in April 2009. This fund is a joint venture between Everstone Capital and Realterm Global, a leading North American industrial real estate investment company. The fund invests in developing modern industrial real estate and warehousing facilities across India. The sole focus is industrial and logistics real estate, an underserved asset class in India. IndoSpace currently has three investments under its belt — at Chakan in Pune, Luhari in the vicinity of Delhi, and Oragadam in the vicinity of Chennai. The total developable warehouse capacity is close to 6.5 million sq ft in these manufacturing belts.