Gati Ltd, a leading express distribution company and part of Allcargo Group, has announced it is exiting Gati Kausar India Ltd, its cold chain solutions business. Gati will sell its approximately 70 percent stake to existing minority shareholder Mandala Capital AG Limited, a leading private equity firm focused on investments across the food value chain. The company expects the transaction to close within the next 30 days.
Following the closure of this transaction, Mandala, which currently holds about 30 percent, will become the controlling shareholder in Gati Kausar. Mandala has been a shareholder in Gati Kausar since 2014.
By way of this transaction, post-closure, Gati's consolidated gross debt will come down by around Rs 100 crore. With this, Gati would have reduced its consolidated gross debt by more than 50 percent over the last 12 months.
Gati, since coming under the Allcargo fold last year, has been on a continuous transformation journey to focus on asset-light, high-return on equity businesses. It has sold or closed down four non-core businesses over the last year, so as to focus entirely on the express distribution and e-commerce businesses and regain market leadership position.
Gati Kausar provides temperature-controlled transport service across verticals comprising healthcare, meat, bio-pharma, dairy products, organized retail and quick-service restaurants. The company operates a 5,500-pallet state-of-the-art warehouse at Dharuhera in Haryana, a 300-pallet warehouse in Delhi for city distribution, and a 3500-pallet leased warehouse in Mumbai. With an extensive fleet of 200 refrigerated vehicles, Gati Kausar can transport cargo at temperatures as low as -25 deg C.
Convergent Finance LLP and Samara Capital have jointly declared the finalization of definitive documents for acquiring a 51.8 percent stake in Agro Tech Foods Limited (ATFL) from a subsidiary of Conagra Brands, Inc. ATFL, a listed company on the Bombay Stock Exchange and the National Stock Exchange, will undergo a mandatory open offer for an additional 26.0 percent of outstanding shares due to this acquisition. The deal is pending customary regulatory approvals and is anticipated to be completed in due course.
Conagra has been a controlling shareholder of ATFL since 2011, and during its tenure, ATFL expanded its food portfolio, featuring renowned brands like ACT II popcorn and Sundrop edible oils. Both brands are leaders in their categories, catering to both in-home and out-of-home consumption. ATFL will retain the license for the ACT II brand from Conagra for use in India.
Harsha Raghavan, Managing Partner at Convergent Finance said, “Agro Tech Foods’ category-defining brands have been beloved household names for the past three decades, thanks to the company’s relentless focus on quality, innovation, and customer delight. As India’s rapidly-growing consumer class expands and discretionary income levels continue to rise, we will expand ATFL’s distribution reach and product range, thereby transforming it into the country’s leading packaged and snack food platform.”
Manish Mehta, Managing Director and Co-Chief Investment Officer at Samara Capital said, “We are delighted to lead the acquisition of a majority stake in ATFL in partnership with Convergent. The company’s brands have high recall value with India’s consumers, and we aim to complement this hard-earned recognition with our knowledge of India’s food and consumer sectors to increase ATFL’s presence in fast-growing, high-margin categories. We intend to create a large and unique branded food platform in the country with this acquisition.”
Convergent Finance LLP, known for its investment management and advisory role, follows a value investing approach, emphasizing fair valuations through negotiated transactions. Samara Capital, founded in 2007, is a mid-market private equity firm in India with a focus on creating long-term value in partnership with entrepreneurs. Consumer and Retail form a significant focus area for Samara.
Conagra Brands, Inc, headquartered in Chicago, is a leading North American branded food company with a portfolio of iconic brands, including ACT II, Birds Eye, Duncan Hines, Healthy Choice, and Marie Callender’s, among others. The company is driven by a commitment to innovation and evolving to meet changing food preferences.
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