Canada's CDPQ to buy minority stake in TVS Logistics for Rs 1000 cr

CDPQ, one of North America’s largest pension fund managers based in Canada, will invest $ 155 million (over Rs 1000 crores) to acquire a sizeable minority stake in TVS Logistics Services Ltd (TVS LSL), a privately held subsidiary of the TVS Group.

Following this transaction, existing investors Goldman Sachs and KKR will fully exit their investments in TVS LSL. CDPQ will purchase most of their joint stake, while TVS family members and management will acquire the remainder.

“Efficiency in delivering goods to customers is a key driver of business performance. TVS Logistics is well positioned to seize growth opportunities resulting from recent tax reforms in India and global demand for state-of-the-art logistics services. CDPQ’s strategy is to identify world-class management teams and to support them over the long term. This is precisely what we intend to do with TVS Logistics as it expands in its home market and abroad,” said Michael Sabia, president and chief executive officer, CDPQ.

Beyond this equity investment, CDPQ will also provide additional capital to finance transformative acquisitions and support the expansion of TVS LSL in India and globally.

R Dinesh, managing director, TVS Logistics Services Ltd., said, “We believe CDPQ is the perfect long-term partner for our next phase of growth as we look to expand the scale of our business. TVS Logistics, over the years, has grown at a CAGR of more than 30 percent and has a strong global track record of growth, both organically and through acquisitions. We look forward to continuing this evolution and building on our successes through a fruitful partnership with CDPQ.”

Over the years, TVS LSL has substantially widened its service capabilities, including last mile delivery, demand forecasting, and technology logistics through its acquisitions in the UK such as Rico Logistics and Multipart. It further added capabilities like sub-assembly and sequencing through its Wainwright acquisition in the US. With a global footprint and suite of sophisticated capabilities and services, TVS LSL is now well positioned to increase its coverage across all segments of the logistics supply chain in India and other parts of Asia.

TVS LSL has a significant presence in the UK and in the USA. Its UK business has grown sevenfold in the last five years from Pound 40 million to Pound 275 million. It is also one of the largest Indian employers in Northern England with more than 3,500 employees in the UK and in Europe. In the USA, it operates through seven facilities with over 800 employees.