Japan’s Kintetsu Invests Rs 267.7 Crore In Gati-KWE JV
By Anuja Abraham
Gati Ltd. has concluded the Joint venture with Japan’s Kintetsu World Express to form Gati-Kintetsu Express Pvt Ltd.
Under the JV agreement, Gati will hold 70 percent stake and 30 percent will be held by Kintetsu World Express (KWE) in Gati-Kintetsu Express Pvt Ltd.
KWE received the Foreign Investment Promotion Board approval and invested a total amount of Rs 267.7 crore for its 30 per cent stake in the JV and the monetary transaction has been culminated. This fund infusion makes GATI’s Balance sheet much stronger through a significant deleveraging of the debt and reduction in the interest costs upto 50 percent, which in turn will help in re-investment in the growth of the organization and will reflect a healthy bottom line.
GATI-KWE brings together the strengths of Gati’s local expertise in Express Distribution and KWE’s global experience in 3PL warehousing, supply chain and freight forwarding capabilities creating an unmatched offering and superior value to customers.
The JV also benefits from India- Japan Comprehensive Economic Partnership Agreement (CEPA) signed in 2011 and the two countries target USD 25 billion worth of bilateral trade by 2014 from the present USD 10.3 billion.
Speaking on the occasion, Mahendra Agarwal, Founder and CEO of GATI LTD said, “The Joint venture with KWE will set a new benchmark in Express Distribution and Supply Chain Solutions in India. All our efforts will now be channelized towards synergizing the strengths of both the companies thereby creating a win- win situation. We believe this alliance will create enhanced value for our customers and shareholders”
Mr Satoshi Ishizaki, President and CEO of KWE, said, “It is a proud moment for “GATI-KINTETSU” brand which combines the excellent infrastructure services of Gati and the service mind of KWE to provide the best possible services for all our customers”