Japan’s Kintetsu to invest Rs2,68 crore in logistics JV with Gati
13 Feb 2012
Japanese logistics company Kintetsu World Express (KWE) plans to invest Rs2,68 crore ($54.25 million) for a 30-per cent stake in a joint venture with Gati Ltd in order to gain access in Asia's third-largest economy.
Gati will transfer its Express Distribution and Supply Chain (EDSC) business to the new JV company Gati-Kintetsu Express, in which Tokyo-based KWE will buy 30 per cent stake for Rs268 crore.
"Under the JV agreement, Gati will hold 70-per cent stake and 30 per cent will be held by KWE. As part of the transaction, Express Distribution and Supply Chain (EDSC) business of Gati will move into the joint venture company through a Business Transfer Agreement,'' Mumbai-based Gati said in a statement.
"KWE will invest Rs2,67.7 crore for its 30 per cent stake in the JV through a combination of primary and secondary acquisition of shares," the statement added.
"The partnership will help us leverage KWEs global customer base, develop world class infrastructure capabilities, enhance our distribution services and further strengthen our leadership position in India," said Mahendra Agarwal, founder and CEO of Gati.
Together KWE and Gati will partner in supporting business expansion of domestic and international customers in the Indian market and the JV shall also invest in high-end 3PL facilities, including temperature controlled warehouses.