Logistics major Delhivery on Saturday announced plans to acquire its competitor Ecom Express Limited in a deal valued at up to Rs 1,407 crore. The acquisition was approved by Delhivery’s Board, the startup disclosed in a regulatory filing. “The Board has approved the execution of Share Purchase Agreement amongst the Company, Ecom Express and their shareholders…Post completion of such acquisition, Ecom will become a subsidiary of the Company,” Delhivery said in a regulatory filing.
The acquisition is expected to be finalised within six months from the date of signing the Share Purchase Agreement (SPA), unless extended by mutual consent. The deal follows a public dispute between the two companies, with Delhivery alleging that Ecom Express misrepresented key operational metrics, including shipment volumes and profitability, in its draft red herring prospectus (DRHP) last year.
“The Indian economy requires continuous improvements in cost efficiency, speed and reach of logistics. 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.
Delhivery also highlighted differing methodologies in calculating shipments. While Delhivery counts both delivery and return of a parcel as a single shipment, Ecom Express considers them as two separate shipments, citing independent billing for each leg.
“Delhivery is among India’s leading fully-integrated logistics service providers with significant scale advantages and will be the ideal shareholder for Ecom Express’ next phase of growth. With this acquisition and its inherent synergies, businesses across India as well as the logistics industry itself will benefit immensely through the combination of two like-minded players.” K. Satyanarayana, founder – Ecom Express, added.