Integrated logistics solutions provider Apollo LogiSolutions Ltd (ALS) is in talks with Piramal Capital’s structured financing group (SFG) to raise around Rs300 crore of credit, said two people aware of the development.
ALS is 90% owned by Apollo International, which is part of the Onkar Kanwar-promoted diversified business house Apollo group.
“Apollo LogiSolutions has been in the market for some time now to raise funds. Piramal is one of the serious parties that is in talks with the company to invest close to Rs250-300 crore in the form of structured debt. For Piramal SFG infrastructure is a core area of focus and, having invested across asset classes, they have a strong understanding of the space,” said one of the two persons cited above, requesting anonymity as the talks are private.
ALS plans to use the funds to primarily expand its warehousing capacity and for small acquisitions, he added.
Earlier this month, Mint reported Apollo LogiSolutions is also in talks with other investors such as Hong-Kong based ADV Partners.
“The firm is in talks with PE (private equity) investors and since no investment has been confirmed, it would not be possible to comment on this speculation,” said a spokesperson for Apollo LogiSolutions in an email response.
An email sent to Piramal on 10 May did not elicit any response.
Facing tail winds such as the impending implementation of the goods and services tax (GST), several logistics businesses are out in the market, seeking funds from investors.
In March, Mint reported that e-commerce-focused logistics firm Ecom Express had initiated the process of raising up to $150 million.
Another logistics firm, CDC-backed Pristine Logistics and Infraprojects Pvt. Ltd, has started talks to raise up to Rs400 crore from PE investors, Mint reported the same month.
Other logistics firms in the market to raise funds include Palogix Infrastructure Pvt. Ltd, home-grown private equity firm True North-backed Innovative B2B Logistics Pvt. Ltd (Inlogistics) and IDFC Alternatives-backed JM Baxi Group.
ALS started operations in 2009 and provides integrated logistics services through a global network spread across multiple locations. Its services include handling of export and import cargo and refrigerated cargo, as well as warehousing.
According to a rating report by CARE Ratings Ltd dated March 2016, ALS reported a profit of Rs2.86 crore on a revenue of Rs91.85 crore in fiscal 2015. For the nine months to December 2015, the firm earned a profit of Rs3.56 crore on a revenue of Rs101 crore, the report said.
ALS has, over the years, also grown through an inorganic approach. In 2013, it acquired a Chennai-based logistics firm and also made an entry into the business of inland container depots through a joint venture with India Glycols Ltd. In 2014, it acquired a controlling stake in Clarion Shipping, a Dubai-based logistics firm.
ALS formed a joint venture with German logistics firm FIEGE in 2012 to form Apollo FIEGE Integrated Logistics in which it owns a 60% stake.