Tata Motors To Acquire A 26.79% Stake In Freight Tiger At A Valuation Of INR 560 Cr

Auto giant Tata Motors on Thursday (October 19) announced that it has signed a definitive agreement to secure a 26.79% stake in logistics SaaS platform Freight Tiger for a cumulative sum of INR 150 Cr ($18 Mn). This roughly translates to a valuation of around INR 560 Cr ($67 Mn).

Under the terms of the agreement made public, Tata Motors would invest an additional INR 100 Cr in Freight Tiger over the course of the next two years.

“Tata Motors and Freight Tiger have… signed a securities subscription agreement (SSA) and a shareholders agreement (SHA) for the acquisition of 26.79% stake in ‘Freight Tiger’ for a consideration of INR 150 Cr. The SSA also includes a provision enabling Tata Motors to further invest INR 100 Cr over the next two years, at the then prevailing market value,” the automaker said. 

The company has stated that the finalisation of the deal is subject to the fulfilment of customary conditions and prerequisites.

As per the automaker, the strategic acquisition will enable Tata Motors to drive effectiveness and efficiency in its truck and freight ecosystem. It will also leverage synergies with Freight Tiger to build a ‘comprehensive end-to-end digital ecosystem for the entire logistics value chain’ and tap into the startup’s resource base. 

“… We are excited to have Tata Motors as a strategic investor who shares our belief and vision to build a unified national platform at an unprecedented scale. With such incredible backing and expertise, the company is strategically positioned to lead India’s efforts in reducing logistics costs to under 10% of GDP…,” Freight Tiger’s cofounder and CEO Swapnil Shah said.

Chiming in, executive director of Tata Motors Girish Wagh said, “… we are excited to announce our partnership with Freight Tiger, a pioneer in digitising the logistics industry… Together, we will create new opportunities for growth and value creation for our customers, partners and stakeholders.”

Founded in 2014 by Shah, Freight Tiger operates a marketplace that connects shippers, carriers, logistics service providers and fleet owners in one place. It also offers end-to-end logistics value chain solutions for the movement of cargo. 

As per Tracxn, the startup has so far raised more than $33 Mn in funding across multiple rounds. The startup last raised $6.5 Mn in a round led by Florintree Infra in September 2021. The platform is also backed by marquee names such as Lightspeed India Partners and Eastern Pacific Shipping’s venture capital arm.

Freight Tiger claims to facilitate more than 10 Mn trips on an annualised basis, and caters to more than 60 clients, including Saint Gobain, Dalmia Group, JSW Steel, Patanjali, Kohler, and MRF, just to count a few. 

It has more than 60 shippers and 4,000+ logistics service providers on the platform. Tiger Freight also claims to cover over 90,000 locations globally. 

The funding comes at a time when investors are showing renewed interest in the logistics SaaS space. Last month, Mumbai-based logistics SaaS platform Kale Logistics bagged $30 Mn in a Series B funding round led by PE firm Creaegis Advisors. 

In May, tech-driven distribution and logistics startup Ripplr secured $40 Mn in a Series B funding round. In the same month, supply chain enterprise tech platform Pando raised $30 Mn in Series B funding led by VC firm Iron Pillar.