Assetz exits JV with global logistic fund LOGOS

Synopsis

The exit will see Assetz own the Bangalore warehousing facilities but will be managed by LOGOS under the development management agreement. NCR and Chennai will be held by a LOGOS Venture and managed by LOGOS.

(Representative image)

In one of the most significant warehousing platform exits in the country, Bangalore-based real estate firm Assetz had exited its joint venture with global logistic fund LOGOS as it planned to focus on residential, data centre and renewable energy business.

The exit was around 15-18% IRR. LOGOS acquired Assetz’s holding taking 100% ownership in the local platform, and mentioned a joint statement by both the companies in an email response.

“There is no real valuation. The deal includes cash and land components that have been traded,” said people aware of the deal.

The joint venture firm, LI Sponsor Investment Pte Limited, equally owned by Assetz Group and LOGOS Group, has 9mn sq ft of gross leasable area with $500 mn of assets under management across the key markets of Bengaluru, Chennai and NCR.

The exit will see Assetz own the Bangalore warehousing facilities but will be managed by LOGOS under the development management agreement. NCR and Chennai will be held by a LOGOS Venture and managed by LOGOS.

“Assetz and LOGOS maintain an ongoing relationship through its strategic Joint Venture in the developing and management of Assetz’s Devanahalli and Nelamangala properties and other strategic mandates,” mentioned a joint statement from both the companies. Both the companies refused to share the valuation.

This transaction was in line with the joint venture’s initial strategy and is consistent with LOGOS’ ownership structure for its other regional operations, where it holds a 100% interest in each country-based process.

“Assetz is also in the process of setting up a data centre fund in excess of over $500mn and is at an early stage,” said the person quoted above.

Assetz and LOGOS established their India business in 2017 to meet the strong demand from customers for modern logistics facilities in India and to leverage the strong market fundamentals of this growing market.

Following the implementation of the Goods & Services Tax (GST) and the emergence of e-commerce, the Indian logistics and warehousing sector is headed towards transformative growth.

The government’s decision to accord infrastructure status to the logistics industry is allowing developers access to low-cost funds for development.

Recently, private equity major Blackstone Group has acquired Embassy Industrial Parks at an enterprise valuation of Rs 5,250 crore from Warburg Pincus and Embassy Group in the largest ever logistics and warehousing deal in India.

Other funds like CPPIB, Ascendas-Firstpace and Indospace are also looking to expand their footprints in the fast-growing logistics and warehousing segment in the country.

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