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Allcargo Logistics Ltd, led by Shashi Kiran Shetty, has emerged the front-runner to buy the container freight station (CFS), inland container depot (ICD) and rail logistics business of Sical Logistics Ltd from the Coffee Day Group, at least two people said.
Sical Multimodal and Rail Transport Ltd (SMART), the rail logistics wing of Sical, holds a Category I licence from the Indian Railways, to ply container trains throughout the Indian Railways network in both the export-import and domestic segments.
SMART owns seven rakes of 45 wagons each and some 1,000 containers. It runs three container freight stations at Chennai, Tuticorin and Visakhapatnam, and is in the process of building two rail-linked inland container depots (ICDs) spread over 70 acres of land near Whitefield in Bengaluru and on 80 acres in Chennai.
The three CFSs’ run by Sical handle about 15,000 twenty-foot equivalent units (TEUs) a month on an average. In FY19, the three stations handled a combined 170,000 TEUs.
The Coffee Day Group had mandated ICICI Securities to sell Sical Logistics as part of a plan to cut the group’s debt. While the group initially preferred to sell Sical to a strategic partner, it has now decided to sell the assets separately on account of a lack of bidder interest to buy the company as a whole.
“ICICI Securities is now trying to sell the SMART division comprising CFS, ICD and rail logistics. The intention is to deleverage the SMART business,” one of the persons briefed on the plan said, asking not to be named.
ICICI Securities, he said, has received bids from at least six top logistics firms, including Adani Logistics, Allcargo and Pristine Logistics & InfraProjects Pvt Ltd.
“Allcargo is leading the race. It has done quite a bit of due diligence, undertaking a number of site visits and is very active,” the person said.
Allcargo currently runs CFS/ICDs at Nhava Sheva (Mumbai), Mundra (Gujarat), Pithampur (Indore), Dadri (Uttar Pradesh) Chennai and Kolkata, with a combined capacity of over 700,000 TEUs.
Sical Logistics could not be reached for comment. Allcargo, in response to a query from BusinessLine , said it did not want to comment on market speculation.
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