Vulcan Express

Snapdeal’s Vulcan Express has Gati, Peepul and TVS Logistics as potential buyers

Vulcan Express

The online marketplace Snapdeal continues to remain in news, thanks to the pace of development happening within the company.

After e-commerce (Snapdeal) and fintech (Freecharge), Snapdeal’s logistics arm Vulcan Express has got some interested buyers – express distribution and supply-chain companies Gati, mid-market private equity firm Peepul and supply-chain player TVS Logistics are a few of them, according to financial daily ET.

The report stated that Snapdeal expecting Vulcan Express to fetch Rs 90-120 crore.

Experts believe that if the company does a successful deal, it will provide much-needed capital relief to its cash-starved owner Snapdeal. But they also feel that sale process could be tough as there is uncertainty in future business opportunity for Vulcan, which counts Snapdeal as its only major client.

The others in fray are Flipkart, the country’s largest e-commerce company, and global private equity major Warburg Pincus. Warburg Pincus is investor in Gurgaon-headquartered, e-commerce-focused logistics company Ecom Express besides two other logistics companies, Rivigo and Stellar Value Chain.

“Vulcan Express has a strong management team and is achieving one of the highest levels of efficiency and service levels in the e-commerce logistics space. We are not surprised by the high level of interest we are seeing in acquiring the business but cannot mention any further specifics,” said Jason Kothari talking to ET.

Jason Kothari, chief strategy & investment officer at Snapdeal is spearheading the transaction on behalf of the online marketplace, with Alvarez and Marsal advising the company.

Since Snapdeal decided to sell off the business, there has been a lot of transaction-related turbulence happening and the company is yet to consolidate a final deal, in spite of the many buyers for its various business arms.

E-commerce major Flipkart was willing to buy out online marketplace Snapdeal at $400 million, minus its two logistics businesses- Vulcan Express and Unicommerce eSolutions, according to media reports.

Last week, the board of Snapdeal rejected an offer of $800-850 million from Flipkart, according to the PTI report. The board felt the amount undervalues the company as the due diligence report is clean.

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