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Allcargo Logistics CFO Not Looking at Large Acquisitions, Says Focus on Divesting Non-Core Assets

December 07 , 2021

Source: Economis Times:

Allcargo Logistics is not looking at any significant large acquisitions over the next 3-6 months and the company is in plans to divest from the project business, shared its CFO Deepal Shah as he discussed his growth strategy with ETCFO. With private equity major Blackstone buying a 90 per cent equity stake in Allcargo’s warehousing vertical ALIPPL, a large part of the company’s non-core warehousing assets will be offloaded, he said.

On the problem of container shortage, Shah said it is real but added his company is ensuring container availability for his customers On inflation, the finance executive hoped it would not significantly impact Allcargo’s margins. Edited excerpts from the interaction are below.

Q. What are your acquisition plans in the next 3-6 months? You seem to be aggressive in the last couple of years acquiring Gati and Nordicon Group

Deepal Shah: Currently, we are not looking at any significant large acquisitions especially over the next 3-6 months The acquisition of Gati has enabled us to gain a leadership position in the domestic B2C logistics space and helped us to become end-to-end logistics solutions providers. With the acquisition of Swedish logistics company Nordicon Group by ECU Worldwide, the wholly-owned subsidiary of Allcargo Logistics, we have gained significant inroads into new market territories. With this acquisition, ECU Worldwide will control around 40 per cent of the LCL market in the Nordic region.

Having said that, we would not shy from exploring future acquisition opportunities having the potential to offer us significant value propositions.