Mumbai: JSW Infrastructure Ltd has placed its bid to acquire Infrastructure India PLC (IIP)-owned Distribution Logistics Infrastructure Pvt Ltd (DLI India) and its group companies, according to information emanating from London’s Alternative Investment Market (AIM). The acquisition bid is aims to help JSW Group led by Sajjan Jindal expand and strengthen the third-party cargo base by offering first-mile, last-mile services.
However, it’s not known as how much price JSW Infrastructure Ltd has quoted to buy the DLI India.
JSW Infrastructure is India’s second biggest private port operator. It will vie with Dubai’s DP World Ltd to take over DLI. Industry sources said that JSW Infrastructure’s prospects to buy the DLI appears better, as the DP World has put some conditions for the acquisition.
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JSW Infrastructure is interested in taking over DLI, which is a supply chain transportation and container infrastructure firm with main offices in Bangalore and Gurgaon, has good presence in central, northern and southern India. The company also offers a range of logistics services including rail freight, trucking, handling, customs clearing and bonded warehousing with terminals located in the strategic locations of Nagpur, Bangalore, Palwal (in the National Capital Region) and Chennai.
Besides, DLI also has integrated logistics lark (ILP) cum private freight terminals (PFTs) in Nagpur and Bangalore, with one more ILP under construction in Palwal region of NCR. It also has a warehouse facility in Hassan in Karnataka and owns about 120 acre land in Chennai. DLI is a license holder category 1 container train operator and has ten rakes, which are currently deployed in its Nagpur facility.
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It’s that the IIP was also looking for a buyer after it rejected an agreement with Pristine Malwa Logistics Park Pvt Ltd (Pristine Malwa) to part off with the rail logistics company. “Infrastructure India PLC is in discussions with a third party and has received preliminary terms for the sale of DLI,” the AIM quoted infrastructure fund that invests directly into assets in India, said in a April 15 regulatory filing, without naming the “third party”.
Industry experts, however, feel that they were not sure if the JSW Infrastructure would really buy the DLI India and when the ongoing talks will lead to an agreement. IIP, in a regulatory filing, had noted that it had received a loan recall notice by DLI India on April 12 from lenders to DLI’s project debt. The DLI owns about ₹700 crore liability to pay the lenders including the Bank of Baroda. The lenders to DLI might invoke Insolvency and Bankruptcy Code if DLI presents no satisfactory response to the notice within two weeks from the date of issue.
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DLI has already been granted a grace period for debt servicing by its lenders until February 2024 and DLI management has been in discussion with the lenders for settlement of dues. Back on February 15 this year, IIP had stated it will not be proceeding with the conditional sale of the Group’s interest in 99.99% of DLI to Pristine Malwa Logistics Park Private Limited, which was announced on September 6, 2023. Later, the Distribution Logistics Infrastructure Limited (Mauritius), IIP’s wholly owned subsidiary, has issued a termination notice to the agreement it had signed with Pristine Malwa.
JSW Infrastructure is also expanding capacity organically by increasing the capacity of its existing ports/terminals. This includes adding 1.6 mt capacity to the 8 mt coal terminal it runs at Kamarajar Port in Tamil Nadu; raising the capacity of Jaigarh Port by building a 2 mt capacity terminal for handling LPG, propane, butane etc; expanding its container terminal capacity at New Mangalore Port; augmenting the capacity of its iron ore terminal at Mormugao Port to 15 mt from 8.5 mt besides constructing a non-major port at Jatadhar in Odisha.
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Industry experts say that expanding the third-party customer base is a focus area for the port operator by engaging with third parties through long-term arrangements. JSW Infrastructure currently has a capacity to handle some 170 mt of cargo across its network of ten operational ports and terminals across India’s coastline.
Last year, JSW Infrastructure ventured into the container train operations business by acquiring the container train operator (CTO) license of Sical Multimodal and Rail Transport Limited from Pristine Logistics & Infraprojects Pvt Ltd. Sical Multimodal and Rail Transport Ltd, the rail logistics wing of Chennai-based Sical Logistics Ltd, holds a Category I license from the Indian Railways, to ply container trains throughout the Indian Railways network in both the export-import and domestic segments.
