Anil Ambani-Patel Roadways talks for buyout deal fail

Satish John & Raj Nambisan

MUMBAI: Anil Ambani’s talks to acquire a significant stake in Patel Roadways, one of India’s largest logistics firms, have come unstuck.

The move was supposed to be Reliance-ADAG’s second major investment in a pure-play logistics firm, after having acquired 44% stake in the Bangalore-based courier and express company DTDC.

Arif Patel, vice-chairman of Patel Roadways, did not comment on the breakoff.

However, a company spokesperson responded by email, stating: “The talks on equity stake were a strategic process to support the new logistics services introduced under Patel Integrated Logistcis Ltd. There is nothing more to read into that.”

Anil Ambani is said to have offered as much as Rs 75 crore for control of the company.

Sources said the senior management of Patel Roadways and Reliance-ADAG officials have held many discussions in the recent past.

But  Arif Patel’s father, who is based in London, and who holds majority control in the company through a trust, is said to have been reluctant to let a strong financial investor get a stranglehold of the company.

Sources said with debt easy to obtain, selling equity to raise funds would have been a costly proposition for the logistics company.

The management of Patel Roadways, nevertheless, plans to continue with expansion and diversification.

A large part of the revenues of Patel Roadways accrue from plying trucks on highways. But the company has of late been expanding its business profile by foraying into full-fledged logistics services that include supply chain management solutions or third-party services.

Towards this strategy, Patel Roadways recently amalgamated its group company, Patel On Board Couriers, with itself.

The company focusses on routes that are less than 1,000 km and between 100-500 km.