Friday, March 06, 2009: 06:25:53 PM

new mantra

Go slow but steady

Logistics sector seems to a favourite of private equity (PE) as more than half a dozen companies like Tuscan Ventures, Blackstone, IDFC, Reliance Capital have signed deals and acquired stakes across logistics companies.

Moreover, India has seen some firms like Biyani's Future Capital and ICICI Ventures launching dedicated funds for investing in logistics. Future Capital's logistics fund worth $700 million to $1 billion will set up warehouses across India and ICICI Ventures' new fund of $3 billion is setting aside money for logistics companies.

According to a report by Venture Intelligence, the investments in shipping and logistics accounted for 22% of total deals by number and 11% of the deal value in 2006-07.

For the right company with viable strategy plan money is no issue, said a logistics operator who is on the look out for foreign firms for increasing his logistics footprint abroad. For those companies who are looking for such investments find private equity the most favoured ones to raising money because it is a long term funding. PEs also bring to the table better corporate governance and skilled manpower, which helps the companies in improving efficiencies and increase the scale of operation.

Even in the current rough market situation, private equity participation in logistics sector hasn't slowed down and with huge amount of investments committed to infrastructure in future, PE flows in logistics is only going to get bigger. They are showing keen interest in logistics as it is perceived as a high-growth sector going forward. Integrated service providers, third- and fourth-party logistics firms and warehousing companies are the potential choices. However, even with the positive outlook for this sector, PE funds are going slow on new deals because of the uncertainty in the financial markets.


Rate me....
Mail this article Mail this article Print this article Print this article

Contribute/ Share your Opinion

More

Page 1 of 1

    Page 1 of 1



Search

Keywords:
Sections:

Magazine Issues

Events

logo Other Times Group Sites: