When a little known Indian logistics company acquired a controlling stake in the powerful international non-vessel-operating common carrier ECU Line in 2006, it seemed an incongruous development.
Belgium-based ECU Line was the known brand and Allcargo Logistics (the Indian buyer) was a small blip on the global logistics map. Since that time, Allcargo has grown by leaps and bounds, due in no small part to the acquisition of ECU Line and its vast less-than-containerload business.
In mid-January ECU Line announced a rebranding of its parent company, with it and Allcargo coming under the new name Avashya. Allcargo in September had announced the change in India.
The move won’t affect how ECU Line is operated. Avashya said it “will continue to operate as an individual player in the industry.”
Allcargo was started in 1993 by Chairman and Managing Director Shashi Kiran Shetty. Its association with ECU Line began in 1995, when it served as ECU Line’s agent in Mumbai and New Delhi. In 2001, it made strategic investments with ECU Line in Dubai and Mauritius, and then, in 2005, it acquired nearly a third of ECU Line.
“Operating under one umbrella, we can better leverage resources, drive deeper engagement with our customers to ensure consistency in quality and level of commitment across the board,” said Shetty, who holds the same titles with ECU Line.
The success of Allcargo’s acquisition of ECU Line is emblematic of India’s significant purchasing power. Indian companies have made significant splashes in the last decade with acquisitions of powerful foreign brands.
Indeed, it is said that if an Indian company is involved in an acquisition these days, it’s the Indian company doing the buying.
While India’s domestic goods movement infrastructure might still be a mess, the country’s business acumen stacks up with any the world has to offer. Companies here are cash-rich, diversified, and hungry to build global names.
It will be interesting to see if India’s growing interest in logistics will manifest itself in more Indian purchases of household names in forwarding and logistics. Allcargo’s experience suggests it’s a good road to tread. — Eric Johnson