In a significant strategic move, TVS Supply Chain Solutions (SCS) has announced the acquisition of Hyderabad-based logistics firm Swamy & Sons 3PL for a deal valued at Rs 88 crore. This acquisition, executed through TVS SCS's wholly owned subsidiary, FIT 3PL, marks a key expansion in the company's operations within the fast-moving consumer goods (FMCG) and fast-moving consumer durables (FMCD) sectors.
Expanding Warehouse Footprint
The acquisition will add approximately four million square feet to TVS SCS's existing warehouse portfolio, which currently stands at 20 million square feet. This addition is expected to bolster the company's position in the Indian logistics market, potentially placing it among the top players in terms of warehouse capacity nationwide.
Strategic Importance and Growth Plans
K Sukumar, CEO of TVS SCS for India, the Middle East, and Africa, emphasized the importance of this development in a statement to reporters in Chennai on Wednesday. He noted that supply chain distribution accounts for about 18% of the company's business, and this acquisition is part of a broader strategy to grow this segment significantly. "This is an important development for us because the move will probably take us among the top few largest warehouse footprints in India," Sukumar said.
He further explained that the company has historically grown through acquisitions globally, and this deal represents its first acquisition in the past four to five years. "We have grown by acquisitions globally. Swamy & Sons 3PL has a significant presence in Andhra Pradesh and Telangana," he added, highlighting the regional strengths that this acquisition brings.
Boosting Presence in Key Sectors
The acquisition is particularly timely, given the evolving economic environment in the FMCG and FMCD sectors. Sukumar pointed out that "keeping in mind the various changes that are taking place in the economic environment as far as the FMCG and FMCD products are concerned, this is going to give us a big boost." This move is expected to enhance TVS SCS's capabilities in handling the distribution needs of these high-demand sectors, leveraging Swamy & Sons 3PL's established operations and expertise.
Overall, this acquisition underscores TVS SCS's commitment to expanding its logistics and supply chain solutions in India, positioning the company for future growth and competitiveness in a dynamic market landscape.
