| Chennai, 8 August 2007: Sical Logistics Ltd, India’s leading provider of integrated solutions for bulk and containerized cargo and offshore logistics, has sold the manufacturing facilities and assets of its auto components division, Indrad Auto Components, for Rs 14.69 crore to Lucas TVS Ltd, one of India’s largest auto electrical manufacturing companies.
With this asset disposal, the total funds realized by the company since the start of the dis-investment process, in 2006, stand at Rs 90.18 crore. The exit from the facilities of the auto components division, part of Sical's non-logistics business , is in continuation of the company’s strategy to exit its non core businesses and focus on the core business of logistics. Sical had been in talks with a number of global majors but zeroed in on the TVS group because of business synergies and the fit of the facilities to TVS’s growing needs.
The current sale does not include the “GATE” business of Indrad. Sical has been in a “technology transfer” agreement with GATE SRL, Italy since 1997 to source ready components used in the manufacture of high wattage engine cooling modules. The facilities at Indrad were used for assembling and for completing process technology related activities before delivering the end product to the customer. In order to serve the customers in the best possible way, Sical would be continuing its partnership with GATE, till further discussion is concluded with the collaborator and the customers.
Sical Chairman Ashwin Muthiah said, “The decision to sell the assets of the thriving business unit with 100% business of various leading OEMs in India, was taken by Sical purely to demerge the non logistics business, due to the change in business focus.”
”We have been consciously trying to exit the non logistics business in a time bound yet value bearing manner. The businesses we exited were exited purely as they were non-core activities and that has helped us to get the right exit value. Although the process of demerging the auto components business took some time, we were focused on getting the structure right and selling in the manner best suited to extract break-up value, which were important factors in the process,” said Ashwin Muthiah.
“Lucas TVS was a good fit for the planned land, building and assets sale as auto components is their core business and getting a ready facility made sense for their growing needs” Ashwin Muthiah added.
About Sical
Sical Logistics Ltd is India’s leading provider of integrated solutions for offshore logistics and multi-modal logistics for bulk and containerized cargo. In 2006-07, Sical moved nearly 22 million tonnes of bulk cargo and 500,000 TEUs of containerized cargo—more than any other third party logistics (3PL) services provider in South Asia.
Sical’s services consist of:
- Bulk logistics: stevedoring; port terminals; customs house agency; ship agency; trucking; railroad; warehousing.
- Container logistics: Container terminals; ICDs/CFSs.
- Offshore logistics: PSV services for deepwater oil drilling; O&M of PSVs for oil exploration companies such as India’s ONGC.
Sical's delivery infrastructure network includes an exclusive walk-in berth at Chennai for ships carrying bulk cargo; a container terminal at Tuticorin; 1.1 million square feet of storage across over 100 warehouses; owned and regularly contracted trucking fleet of over 2500 vehicles; and container freight stations at 4 locations across India. Sical's FY2006-07 revenue was Rs 9.90 billion on Rs 301.9 million equity capital.
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