Consolidating its position as the single-largest shareholder in the express logistics company Gati, Mumbai-based Allcargo Logistics
has increased its stake in the former to 20.8 per cent by acquiring an additional 7.5 per cent stake on Tuesday.
The Avvashya Group company had taken its stake to 13 per cent in Gati last week, via a preferential allotment and through open market purchases. With this, Allcargo Logistics
today has inched further in its majority stake buy and is on track to complete the process to acquire 44.5 percent stake in Gati, the total deal size of which is Rs 416 crore.
While Allcargo Logistics
continues to raise its stake in Gati week after week, the latter is in a court dispute over ownership of the shares within the promoter family.
The sons and spouse of Gati promoter Mahendra Agarwal have approached the National Company Law Tribunal
(NCLT) against him for alleged oppression and mismanagement in the company and have sought reconstitution of the board.
The Agarwal family members have approached the Hyderabad bench of the NCLT seeking tribunal’s intervention in the affairs of the company.
“Allcargo has been abiding with the regulatory and compliance norms while carrying out the transaction. With this acquisition, we will gain a leadership position in the domestic express transportation segment and develop capabilities to offer end-to-end transportation to our valued customers,” the release quoted Shashi Kiran Shetty, Chairman at Allcargo Logistics.
This time, Allcargo bought an additional 9.1 million shares in Gati in two different transactions. The company directly bought 5.16 per cent stake from the Gati promoters, pursuant to the share purchase agreement and acquired another 2.31 per cent through open market purchases, it said in a release today.
The recent purchase of shares from the promoters marks the end of the second phase of a three-way deal that Allcargo intends to complete in due course, said the release.