Delhivery has announced the acquisition of rival firm Ecom Express in a deal worth Rs 1,407 crore. Following the completion of the deal, Ecom Express will become a subsidiary of Delhivery, the company said in an exchange filing. The move comes just months after Ecom Express decided to pause its plans for an initial public offering (IPO).
"This acquisition aims to enhance Delhivery's scale, thereby strengthening its value proposition to clients. The increased scale resulting from this acquisition is expected to allow Delhivery to invest more effectively in improving service quality through network expansion, network quality improvements (such as automation and electric vehicles), technology investments, and research and development (e.g., robotics and drones)," the company said in an exchange filing.
The acquisition is expected to be completed within six months from the date the share purchase agreement (SPA) was signed. "We believe this acquisition will enable us to service customers of both companies better, through continued bold investments in infrastructure, technology, network and people. The founders and management of Ecom Express have established a high quality network and team, creating a strong foundation to integrate into Delhivery’s operations," Sahil Barua, MD and CEO, Delhivery said in a release.
Ecom was incorporated in the year 2012 and is an 'end-to-end technology-enabled logistics solution provider. The company is headquartered in Gurugram, Haryana.
Delhivery share price
In the quarter ending December, the logistics unicorn recorded a consolidated profit of 25 crores, marking a 114% year-on-year (YoY) surge from Rs 11.7 crore reported in the corresponding quarter of the previous fiscal. Revenue from operations stood at Rs 2,378 crore during the same period, marking a marginal rise of 8% YoY.
However, the share price trajectory of the logistics firm has remained muted. In the last 6 months, Delhivery shares have declined by over 35%. Since its listing, the company has struggled to impress D-street investors. On Friday, the Delhivery shares concluded the trading session at Rs 261, down by nearly a per cent.
