IPO-bound Delhivery raises $100 Mn from FedEx subsidiary

IPO-bound logistics and supply chain services startup Delhivery has raised $100 million in equity from FedEx Express, a subsidiary of the global logistics giant FedEx Corporation, and the two companies will enter into a long-term commercial agreement following the transaction. 

The investment comes just months after Delhivery had raised $277.4 million in its Series H round which was led by Fidelity Investments in May. Entrackr had exclusively reported the fundraise.

As part of this new transaction, FedEx Express will focus on international export and import services to and from India. Moreover, Delhivery will sell FedEx Express international products and services in the Indian market and provide pick-up and delivery services across India, the companies said in a joint statement on Friday. 

FedEx will also transfer certain assets related to its domestic business in India to Delhivery, which is eyeing to issue an initial public offering in 2022. Additionally, Don Colleran, president and CEO of FedEx Express will be nominated to Delhivery’s Board of Directors.

Delhivery offers logistics services such as express parcel transportation, reverse logistics, cross-border, B2B & B2C warehousing, end-to-end supply chain services, and technology services across over 18,700 pin codes in India. 

The Sahil Barua-led company claims to have fulfilled over 1 billion shipments since its inception in 2011 and works with over 15,000 customers, including large & small e-commerce participants, SMEs, and other enterprises and brands.

FedEx Express said it has a delivery network serving more than 200 countries and territories. 

It’s worth noting that Bhavesh Manglani and Mohit Tandon, two of the five co-founders of Delhivery, had moved on from the company in March and they have now been reclassified as retiring and non-active promoters in the company.

While the company is yet to disclose its earnings for FY21, it had improved its financial performance in FY20. According to Fintrackr, it has been able to narrow its losses to Rs 269 crore in FY20 from Rs 1,772.7 crore in FY19. During the period, its consolidated revenue had surged by 76.4% to Rs 2,988.6 crore as compared to Rs 1,694 crore in the previous fiscal year.