Delhivery Completes Minority Stake Sale To FedEx Post CCI Nod

IPO-bound logistics unicorn Delhivery has completed a transaction involving a minority stake sale to FedEx India.

In its draft red herring prospectus (DRHP), Delhivery had said that FedEx would subscribe to 20,914,500 equity shares as per the agreement.

The transaction also includes the acquisition of certain operating assets of FedEx India and TNT India Private Limited (TNT) by Delhivery. TNT India is part of the FedEx group and also provides logistics services in the form of express parcel deliveries, special services, and freight services.

“FedEx Express, a subsidiary of FedEx Corp, and Delhivery, today announced the strategic alliance transaction signed in July has taken effect, following satisfaction of closing conditions including regulatory approval from the Competition Commission of India,” said a statement from Delhivery.

It said that the transaction combines the FedEx global network with Delhivery’s pan-India network and technology solutions.

Speaking about the alliance, Sahil Barua, CEO, Delhivery, said, “This strategic alliance will enable us to leverage synergies created between Delhivery’s capabilities in India and the FedEx global network to bring new products and opportunities to both Indian and global businesses and consumers.”

Don Colleran, president and CEO of FedEx Express will be nominated to the Delhivery Board of Directors.

CCI had approved the transaction last month.

In July this year, Delhivery announced the raising of $100 Mn from FedEx at a valuation of $3 Bn.

As part of the agreement, FedEx Express has entered into a long-term commercial pact with SoftBank-backed Delhivery.

While FedEx Express will focus on international export and import services to and from India, Delhivery will, in addition to FedEx, sell FedEx Express international products and services in India and provide pick-up and delivery services across the country, according to the agreement.

Delhivery’s IPO Plans

The Gurugram-based unicorn in November filed its draft red herring prospectus for INR 7,460 Cr.

It will include a fresh issue of shares worth up to INR 5,000 Cr and an offer-for-sale of up to INR 2,460 Cr. It is worth noting that these offers can change as the startup heads towards its listing. 

Masayoshi Son’s SoftBank will be offloading shares worth INR 750 Cr in Delhivery, whereas Carlyle Group is likely to sell shares worth INR 920 Cr. Another investor, Times Internet will be selling shares worth INR 330 Cr. 

Recent Financials

During the first quarter (April-June) of the current financial year (FY22), the logistics unicorn recorded a consolidated net loss of INR 129.58 Cr.

Its revenue from operations for the same period was INR 1,317.72. The DRHP, however, did not mention the financials for the corresponding quarter of the previous fiscal (FY21).