Express distribution and supply chain solutions firm Gati Ltd which reported broadening of its consolidated loss at Rs.173.40 crore in the March quarter, is opting out of its cold chain solutions business — Gati Kausar India.

Gati will vend off its approximately 70% stake in Gati Kausar India to existing minority shareholder Mandala Capital AG Limited, a major private equity firm aimed on investments across the food value chain, the company publicly announced through a statement.

Mandala, which presently possesses about 30% share of the biz, has been a shareholder in Gati Kausar since 2014. Following the completion of this transaction, which will hopefully be done within the coming 30 days, Mandala will become the controlling shareholder in Gati Kausar.

The company had witnessed a loss of Rs. 70.60 crore in the corresponding period a year ago. Revenue from operations grew by 9.88% in the quarter under review to Rs. 406.64 crore, from Rs 370.09 crore in the year-ago period, as per the filing. In the quarter ending on 31st March, 2021, Gati Ltd reported a total exceptional expenditure of Rs 172.87 crore. The company reported diminution amounting to Rs 171.03 crore in the present fair value of the assets sold during the year and proposed to be sold.

After its exit from the cold chain solutions business and following the closure of the transaction, Gati’s consolidated gross debt will come down by about Rs. 100 crore. With this, Gati would have lowered its consolidated gross debt by more than 50% over the last 12 months.

The company declared since its acquisition by Allcargo group last year that it has been on a continuous transformation journey to emphasize on asset-light, high-return on equity businesses. Gati has sold or closed down four non-core businesses over the last year, so as to concentrate solely on the express distribution and e-commerce businesses and get back to its market leadership position.

Author

A Zoophile scrambling the horizon for surreal subtleties, sheer poetic at heart and quite handy with life.

Write A Comment