Hindustan Infralog buys majority stake in Continental Warehousing Corporation
March 19, 2018: In a recent development, Hindustan Infralog Private Limited (HIPL), a joint venture between DP World, and the National Investment and Infrastructure Fund (NIIF), acquired 90 percent stake in Continental Warehousing Corporation (Nhava Seva) Ltd (CWCNSL), an integrated multimodal logistics player in India.
The Reddy family, the founders of CWCNSL will retain the rest 10 percent shareholding, and shall continue to remain involved in the business operations.
The purchase consideration is below five percent of DP World’s net asset value as of FY20171, and it’s the first investment of HIPL, the recently created joint venture between DP World and NIIF to invest up to $3 billion in ports, logistics and related sectors.
Founded in 1997, CWCNSL is a leading integrated multimodal logistics provider of warehousing, container freight stations, inland container depots, private freight terminals, and integrated logistics solutions.
CWCNSL’s logistics network is spread across key strategic locations in India, which covers a total area of over 400 acres, and offers over 660k TEU (twenty-foot equivalent units) capacity.
Additionally, CWCNSL’s wholly owned subsidiary, Delex Cargo India, provides door-to-door logistics solutions, including freight forwarding, third party logistics, express logistics and hub-and-spoke model of delivery across 54 locations in 40 cities.
In India, DP World has been operating container port terminals since 1997, and was instrumental in building the first private public partnership (PPP) project for the government of India.
It’s currently present across six locations in India, with over six million TEU of gross capacity, and also operates container trains connecting ports to the hinterland.
The acquisition of CWCNSL is expected to further enhance DP World’s presence in the entire logistics value chain in India.
The current operations of CWCNSL are highly complementary to the DP World’s existing business, in terms of the business model and geographic footprint, which will provide significant new revenue opportunities over the long term.
Sultan Ahmed Bin Sulayem, group chairman and CEO, DP World said: “We are delighted to start our recent partnership with NIIF with this strategic acquisition to develop logistics and warehousing solutions to support India’s growing economy and trade. As a global trade enabler, we aim to grow in complementary sectors of the global supply chain, which includes inland container terminals, freight corridors and logistics infrastructure. The acquisition of Continental Warehousing Corporation provides us with a scalable platform to accelerate growth in the rapidly evolving logistics sector in India. We look forward to actively collaborating with the Reddy family, our partners in Continental Warehousing Corporation, to drive and realize the Company’s growth.”
Adi Keshav Reddy, founder, CWCNSL said: “The strategic partnership with Hindustan Infralog and its parent DP World, will have huge potential for logistics infrastructure in India, and will enable CWCNSL to enhance its end-to-end value-added services to customers. We have enjoyed a successful partnership with Warburg Pincus, IFC and Aureos, and we look forward to partnering with Hindustan Infralog for the next phase of the company’s growth.”