Reliance Cap picks up 44% stake in DTDC

The Anil Dhirubhai Ambani-controlled Reliance Capital has acquired 44 per cent stake in the Bangalore-based courier and express service company DTDC.

The management of the company would continue to be in the hands of DTDC Chairman and Managing Director Subhashish Chakraborty, who retains the remaining 56 per cent stake.

The announcement comes within hours of Reliance Capital Ventures, which is proposed to be merged with Reliance Capital, saying it has filed a revised information memorandum with the Bombay Stock Exchange for listing the company on the bourse. Reliance Capital Ventures is expected to be listed with the bourses this week.

Srinath Srinivasan, head - private equity, Reliance Capital, said, "Relaince Capital believes that this industry (logistics) is poised for mega growth and the third party logistics is becoming important as India's retail sector gets more and more organised."

Reliance Capital acquired the minority stake through Reliance Private Equity.

Last year, Reliance Life Insurance, a subsidiary of Reliance Capital, had acquired Chennai-based AMP Sanmar Life Insurance Co for about Rs 225 crore.

It had also bought 51 per cent stake in Adlabs Films, a film-processing laboratory, for about Rs 350 crore. With an open offer of another 20 per cent, total cost of up to 71 per cent acquisition, made through its subsidiary Reliance Land Pvt Ltd, was about Rs 500 crore.

DTDC, with a network of 3,700 franchisees, has revenues of Rs 125 crore on a standalone basis and aims to grow it to Rs 500 crore by 2010. DTDC's consolidated revenues (including its franchisees), however, touch Rs 250 crore currently.

The Bangalore-headquartered courier firm, which handles around eight million parcels a month, is contemplating opening offices in far eastern countries, besides China. It already has presence in New York, New Jersey, London, Dubai, Dhaka, Colombo and Singapore.

"Reliance Capital, apart from its investment, also endorses DTDC's unique business model. The alliance is also expected to bring a lot of value-addition to the company. We chose Reliance Capital because of its professional approach and speed of implementation," said Chakraborty.