ML acquires Rivigo’s B2B express business in slump sale. Value deal.

Mahindra Logistics (ML) has announced acquiring Rivigo’s B2B express business, as a going concern, on slump sale basis, for a lump sum consideration of Rs. 225 crores.

  • Rivigo, founded in 2014, operates in two key business segments: Full Truck Load (FTL) and B2B express business. It’s main focus and USP is the relay trucking model with a strong tech interface. Post divestment of B2B business, Rivigo will continue to own it’s truck fleet and the right to the FTL business.
  • In the B2B express business, Rivigo operates an asset light model. It has a Pan India network covering over 19,000 pin-codes and operates through 250+ processing centres and branches.
  • ML’s acquisition in B2B business includes:
    • Customers
    • Team
    • Assets
    • Technology platform
    • Rivigo brand
  • Rivigo’s B2B express business turnover track record
    • FY 20: Rs 528.5 crore
    • FY 21: Rs 295 crore
    • FY 22: Rs 371.3 crore

To me, the subject acquisition is attractive and makes sense for ML.

  • It’s done at less than 1 times of sales.
  • ML will get access to Rivigo’s customer base, technology and processes. We can question financial prospects of loss making start-ups – however not their tech prowess. Hopefully, ML can combine that with it’s prudence and existing scale to make the operations financially viable too.
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