SoftBank Vision Fund to acquire additional stake in Delhivery

SoftBank Vision Fund, the world’s largest technology investor, is set to buy an additional stake from existing shareholders of logistics startup Delhivery Pvt. Ltd, according to filings by an affiliate of the fund with the Competition Commission of India (CCI), accessed by business information platform Paper.vc.

“The filing proposes a secondary transaction i.e. the purchase of shares from an existing shareholder or shareholders constituting 3.28% of the fully diluted capital of the company. If and when the CCI approves this transaction, it would result in an increase in SoftBank’s shareholding, from the current holding of 22.44% to a proposed 25.72%,” Paper.vc said in a note.

Earlier this year, Delhivery raised $413 million from SoftBank at a post-money valuation of $1.5 billion. Existing investors Carlyle Group and Fosun International also participated in the funding round. Following that transaction, SoftBank became the largest shareholder in Delhivery followed by Tiger Global Management and Nexus Venture Partners with 15.38% and 14.77% stake, respectively.

Gurugram-based Delhivery was founded in 2011 by Sahil Barua, Mohit Tandon, Bhavesh Manglani, Suraj Saharan, and Kapil Bharati, who collectively hold 8.51% in the company.

It operates across 2,000 cities, offering a full range of logistics services, including express parcel transportation, freight, business-to-business and business-to-consumer warehousing and technology services.

“It is as yet unclear which shareholder or shareholders are selling their shares, though we estimate the cash consideration for this deal to be in the range of $50 million. Prime suspects among existing shareholders include a set of individual shareholders who cumulatively hold 0.56% and a few institutions such as Times Internet and one Nexus Fund that might want to cash out before another SoftBank-led IPO (initial public offering),” said Vivek Durai, founder of Paper.vc.

Delhivery is the top firm in the logistics space in SoftBank’s portfolio, Durai said. “It checks all the boxes for SoftBank. Delhivery is way ahead of most other portfolio companies in SoftBank’s public offering pipeline. It has a play across e-commerce logistics and an evolving business around general logistics for SMEs (small and medium enterprises). It makes a lot of sense for SoftBank to opportunistically increase its holding,” he said.

Last month, Canada Pension Plan Investment Board had bought an 8% stake in Delhivery for $115 million from an existing investor.

Delhivery plans to scale up warehousing and freight services, and sign global partnerships to improve the reach, reliability and efficiency of transportation operations, according to a Mint report in September.