Blackstone to invest Rs380 cr in Allcargo's warehousing business

Blackstone is investing Rs380 crore in Allcargo Logistic’s warehousing business, as the buyout firm expands into logistics to tap the growing demand for warehouse parks in key consumption hubs in the country.

Blackstone will be investing in both equity and debt capital of Allcargo’s warehousing business, the company stated in a release on Monday.
“Allcargo will retain a minority stake in the various logistics assets and transfer its debt as it relates to these specific assets to their relevant subsidiaries. The transaction is expected to conclude in a phase wise manner over the next 12 months," the statement said.
The partnership will also help Allcargo’s growing third party logistics business, the company said.
Allcargo has six million square feet of Grade A logistics parks, including completed and ongoing projects in advanced stage of developments, across the National Capital Region (NCR) Delhi, Bengaluru, Hyderabad, Ahmedabad, Pune, JNPT in Mumbai, Hosur and Goa.
About 80 per cent of the company’s warehousing portfolio is pre-leased, of which close to 1.5 million square feet is income generating. 
The company also has projects in the planning stage for another three million square feet.
Incorporated in 1993 by Shashi Kiran Shetty, Allcargo provides a comprehensive range of services, such as multimodal transport operations, container freight station operations, or inland container depot operations, projects and engineering solutions, warehousing, distribution, contract logistics and logistics parks.
“The Indian warehousing sector is scaling an expansionary curve backed by a robust regulatory environment and government thrust in boosting manufacturing, e-commerce and organised retail. This sector has emerged as an attractive investment destination for global investors," said Shetty, chairman of Allcargo Logistics Ltd.
Through this strategic tie-up, “we reiterate our commitment and positioning to create a global benchmark in warehousing infrastructure and provide state-of-the-art warehousing solutions to our customers," he added.
Allcargo is also expanding its transportation network through both acquisitions and organic growth.
Last month, Allcargo announced plans to acquire a controlling stake in Gati Ltd for around Rs416 crore to enter the express logistics space.