In a weak market, Delhivery shares surge as co to acquire Ecom Express for ₹1,407 crore

The stock climbed 1.72% to ₹263.25 apiece on the National Stock Exchange (NSE) at 1:19 pm.

Delhivery's board approved the "acquisition of shares equivalent to at least 99.4% of the issued and paid up share capital, on a fully diluted basis, of Ecom Express Ltd for a purchase consideration not exceeding ₹1,407 crore."

The deal is likely to be completed within the next six months.

The Gurgaon-headquartered firm said that the acquisition will enhance its scale, which will allow the company to invest more effectively in improving service by network expansion.

Ecom Express' turnover stood at ₹2,607.3 crore in the financial year 2023-24 (FY24), ₹2,548.1 crore in FY23, and ₹2,090.3 crore in FY22.

Sahil Barua, MD and CEO, Delhivery said, "The Indian economy requires continuous improvements in cost efficiency, speed and reach of logistics. We believe this acquisition will enable us to service customers of both companies better, through continued bold investments in infrastructure, technology, network and people. The founders and management of Ecom Express have established a high quality network and team, creating a strong foundation to integrate into Delhivery’s operations."

The transaction completion is subject to approval from the competition watchdog Competition Commission of India (CCI), and customary closing conditions.

The uptick in the stock comes when markets are trading in deep red. NIFTY50 slipped 4.71% to 21,825, while SENSEX declined 3,332 points to 72,031.

All NIFTY constituents are down, with Trent, Tata Steel, JSW Steel, Shriram Finance, Tata Motors, Hindalco and L&T being the top laggards.