Mumbai-based surface transportation firm Patel Integrated Logistics Ltd has floated a joint venture with Saudi Arabia's financial services firm Nationwide Group Co to tap emerging opportunities in Gulf Cooperation Council (GCC) countries.
The two companies have entered into a memorandum of understanding, under which Patel Integrated will share expertise, technology and manpower to set up and manage the end-to-end operations of the venture, christened as Pivot Logistics CJSC, the Indian firm said in a filing with the stock exchanges.
Patel Integrated will not make any capital investment, but will earn 19.85% sweat equity for applying its know-how in managing the venture’s operations. The venture is expected to start operations in Dubai by 2017 and across the Gulf countries by 2018.
“With the lucrative margin available in the Gulf countries, the joint venture is expected to enhance the bottom-line of Patel Integrated,†said Patel Integrated’s executive vice-chairman Areef Patel.
The JV will set up a network of more than 50 destinations with operations in warehousing and logistics software. After setting up the network for warehousing and logistics software in the first phase, the company will move into air cargo, along the lines of Patel On-Board Couriers (POBC), and the marine sector in the third phase.
Earlier this year, Patel Integrated raised Rs 18.73 crore through an issue of equity shares and equity warrants on a preferential basis to Mauritius-based Frontline Strategy Pvt. Ltd, an India-focused private equity investment firm, to fund its e-commerce venture plan.
It has recently set up an arm for e-commerce, after partnering with Amazon for express delivery.
On the other side, Nationwide Group is a financial services and investment firm founded by Saudi businesswomen Abeer Bint Mohammed.
Like this report? Sign up for our daily newsletter to get our top reports.
