Allcargo plans to set up container freight station

Acquires 9.5 acres land near Chennai port

Mumbai-based Allcargo Global Logistics Ltd which is planning to come out with an initial public offer, has acquired 9.5 acres of land near Chennai port to set up a container freight station (CFS).

Addressing a press conference in connection with the company's forthcoming public issue, Shashi Kiran Shetty, chairman and managing director, Allcargo, said the company would invest about Rs 31 crore including the land cost, in setting up the CFS, which is intended to cater to the container traffic in the southern region. It will have a capacity to handle 4,500 containers per month.

CFS in Chennai will be set up in two phases. Phase 1 is expected to begin operations by October 2006 and Phase II is expected to begin by October 2007.

Allcargo is proposing to enter the capital market to raise money for setting up container freight stations (CFS) and inland container depot (ICD) at Chennai, Mundra and National Capital Region, repayment of loan availed from Yes Bank and general corporate expenses including acquisitions.

It will be entering the market on June 1 with a public issue of 20.79 lakh equity share of Rs 10 each through book-building process. The issue will close on June 6.

The price band has been fixed at Rs 625 to Rs 725 per equity share of Rs 10 each. The issue will constitute 10.26 per cent of the post issue paid-up capital of the company.

At present, Allcargo has a CFS at Nhava Sheva in Navi Mumbai near Jawaharlal Nehru Port Trust (JNPT) with a capacity to handle 1,20,000 twenty foot equivalent units (TEUs).

The company operates in three business categories including multimodal transport operations, container freight station and project cargo handling.

It has acquired 49.99 per cent stake (for about Rs 75 crore) in Ecu Hold NV, holding company of the Belgium-based Ecu Group, engaged in logistics services. "This acquisition will help take Allcargo into global scale," said Shetty.