Allcargo Global acquires 2 HK-based NVOCC

Allcargo Global Logistics Ltd, a Mumbai-based logistics service provider involved in multimodal transport operations (MTO), owning and operating container freight stations (CFSs) and handling of project cargo, has announced the acquisition and controlling stake in Hong Kong-based companies engaged in NVOCC business, Exim News Service reports.

The acquisition, valued at approximately $22 million, has been undertaken in furtherance to the expansion plan of the company of its NVOCC business, through its step down wholly-owned subsidiary.

To further expand into the project cargo movement business, Allcargo Global has acquired two vessels with a dead weight of approximately 6,500 tons through its wholly-owned subsidiary company.

Referring to the acquisition, Mr Shashi Kiran Shetty, Chairman and Managing Director, Allcargo Global Logistics Ltd, said, "This acquisition will further expand Allcargo’s growth organically, strengthening the company’s operating profit by adding approximately $ 3.53 million on an annual basis. The company will save substantial cost on ship chartering and hiring thus supporting planning and execution of project cargo movements in an efficient and effective manner. This further helps to capitalise on opportunities in the Indian Subcontinent, including coastal movement."

He added, "These companies are agents of ECU Line within the global network. China is a leading international ex-im economy and a large cargo generator. Through this acquisition, we will further consolidate our position in the global LCL market. The two companies employ 350 people. The group has its regional headquarters in Hong Kong and has ambitious plans for the region."

With presence in over 59 countries covering more than 5,000 destinations, Allcargo has clocked a compounded annual growth rate (CAGR) of 31 per cent in FY 09, with revenues touching Rs 2,500 crore. The company acquired ECU Line in 2006 and Hindustan Cargo in 2007, and has also entered into a joint venture with Concor to establish an inland container depot (ICD) in Dadri.

The projects and equipments divisions, specialising in handling large infrastructure projects in India, have grown rapidly in the last two years by providing end-to-end logistics solutions to large companies setting up processes, cement, windmill, oil and gas, aluminium and steel projects across the country.

The equipments/cranes purchased during the last two years have added significant value to the company by being known as the only project solutions provider in the country, moving away from the traditional transportation and rental models.

Source: Transportweekly