
In a big move for the logistics industry, Delhivery has announced its acquisition of Ecom Express in an all-cash deal valued at Rs 1,407 crore.
This deal, which marks the largest consolidation in the sector, comes at a time when Ecom Express has been grappling with financial difficulties and has recently cancelled its plans to go public.
According to an ET Tech report, once considered a strong competitor to Delhivery, Ecom Express was last valued at over Rs 7,000 crore in June 2024 but has struggled with operational challenges in recent months.
Through this acquisition, private equity firms Warburg Pincus, Partners Group, and British International Investment will completely exit their investments in Ecom Express. For Delhivery, the deal represents a strategic move to increase its scale and strengthen its competitive position in the fast-evolving logistics market.
Sahil Barua, Managing Director and CEO of Delhivery, expressed confidence in the move, stating, “The Indian economy needs continuous improvements in logistics cost efficiency, speed, and reach. This acquisition will help us serve the customers of both companies better by making bold investments in infrastructure, technology, and our network.”
Delhivery, with Rs 5,488 crore in cash and cash equivalents as of September 30, 2024, is well-positioned to finance the acquisition. The deal is still subject to approval from the Competition Commission of India (CCI) but is expected to close in the next six months. After the acquisition, Ecom Express will operate as a subsidiary of Delhivery.
The deal marks the end of Ecom Express’s IPO ambitions. The company had previously filed a draft prospectus in August 2024, seeking to raise Rs 1,284.5 crore in fresh capital while also offering Rs 1,315.5 crore in secondary stake sales. However, the deteriorating market conditions led to the postponement of these plans.
In the lead-up to the acquisition, Ecom Express had already begun consolidating its operations, shutting down several delivery hubs, and laying off hundreds of employees. Delhivery had also raised concerns about Ecom Express’s financial practices, accusing its rival of inflating its operational metrics, particularly by double-counting return-to-origin shipments, which inflated the company’s reported volumes.
Ecom Express has faced further challenges following the death of its cofounder, T. A. Krishnan, in October 2023. Krishnan, who helped establish the company in 2012 and played a vital role in shaping India’s e-commerce logistics landscape, had stepped back from day-to-day operations over a year before his passing.