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SoftBank Vision Fund Seeks CCI Approval For Acquiring Delhivery Stake

SoftBank Vision Fund Seeks CCI Approval For Acquiring Delhivery Stake

SoftBank is looking to acquire 37.87% of the shareholding in Delhivery

The acquisition will be done through SVF Doorbell (Cayman) Ltd

Earlier, Delhivery was speculated to raise $450 Mn from the SoftBank Vision Fund

SoftBank Vision Fund is getting ready to open the year with yet another unicorn-making investment, this time in the logistics space. The Masayoshi Son-led fund has sought approval from the Competition Commission of India (CCI) to acquire a 37.87% stake in Delhivery Pvt Ltd.

The proposed combination is in the nature of acquisition and falls under 5(a)(ii)(B) of the Competition Act, 2002. The Japanese investment firm will make the acquisition through a Cayman Islands-based holding company called SVF Doorbell (Cayman) Ltd, created on behalf of the $93 Bn SoftBank Vision Fund.

The reports regarding SoftBank’s investment in Delhivery surfaced in November last year. The company was speculated to raise $450 Mn from the Vision Fund, thereby making SoftBank, the largest shareholder in Delhivery.

As Inc42 reported earlier, SoftBank, through its Vision Fund, may invest an estimated $350 Mn as fresh capital in Delhivery. It will also make additional secondary transactions, estimated at $100 Mn, to further bump up its stake in the company. As part of the secondary deal, the company’s founders are also expected to cash out and get new stock options at a strike price equal to 15% of the price per share in the latest round.

Founded in 2011 by Mohit Tandon, Sahil Barua, Bhavesh Manglani, Kapil Bharati, and Suraj Saharan, Delhivery services about 600 cities and 8,500 pin codes in India. It has 12 fulfilment centres for B2C and B2B services and works with ecommerce companies such as Flipkart and Paytm.

The Economic Survey 2017-18 said the logistics industry is set to be worth $215 Bn in the next two years, growing at a CAGR of 10.5 %. This makes Delhivery a lucrative bet for SoftBank. Also, as a company, Delhivery has been showing a strong financial performance.

In FY18, the company reported a jump of 42% in its revenue gaining total revenue of $153.26 Mn (INR 1,073.64 Cr). Here, its operational revenue contributed almost 95% to its total revenue as against $107.92 Mn (INR 756 Cr) for the previous year.

SoftBank has already invested more than $7 Bn in the Indian startup ecosystem. In 2018, the Japanese conglomerate realised a gain of $1.3 Bn (¥ 146.7 Bn) from the sale of its shares in Flipkart, as part of $16 Bn Flipkart-Walmart acquisition deal.

In a bid to foray into the Indian food delivery space, SoftBank Vision Fund is also exploring investment opportunities in either of the two foodtech unicorns Swiggy and Zomato.

Author

Meha Agarwal

Inc42 Staff

Meha has engineering and MBA degrees, but she has always been a writer at heart. It was the perfect combination of utilising her research and analytical skills and her enthusiasm for writing that sparked her interest in writing about the Indian startup ecosystem – the latest tech and gadgets and the startups that create them. She is always on the lookout for industry-specific stories in niche areas of interest such as ecommerce, fintech, greentech and more.

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