TVS Logistics Services Limited (TVS LSL), has announced that it has formed a Holding Company in the US – TVS Logistics Investment USA – and has bought out its Joint Venture Partner’s stake in TVS America (TVS America was set up in the year 2007 with Global Rush owning 51% and TVS Logistics Services owning the remaining). Further it has purchased 100% stake of Manufacturers Equipment & Supply Company (MESCO) based in Michigan providing Logistics Services to the Automotive and Industrial Tool & Die sector.
TVS LSL has been acquiring companies overseas to grow with the Indian suppliers who have ambitions to grow globally or to acquire new capabilities which can be usefully deployed in India and Asian markets. With this acquisition, TVS LSL’s combined turnover would exceed Rs 1200 crores in the year ending March 2011.
TVS LSL will be investing approximately Rs.50 Crores in North America to achieve a turnover in the full financial year of FY11 in excess of Rs.250 Crores. Further, this acquisition will make available a top-management team to further expand TVS LSL customer base in North America.
It may be recalled that this is TVS LSL’s second major acquisition in the last 15 months. In October 2009, TVS LSL acquired Multipart Holding in UK. With these acquisitions, TVS LSL has acquired the capability to offer a complete range of services to its customers.
TVS LSL is finalizing its plans to reach Rs. 2,000 crore turnover in FY12 as compared to Rs.1,200 crore in FY 11. TVS LSL would be not only the first Indian Logistics Company to become a Multi National Service Provider but also would be the leader in offering a complete basket of services to its various customers.
MESCO was a family owned company established in 1945 which initially was a distributor of industrial products in the Tool and Die industry. It later converted itself into a specialized Logistics Service provider offering a one stop solution to the Tool & Die manufacturers in the Automotive and Industrial Sector. Today while the company serves more than 250 customers and has two major customers in America, it will further add to its customer base in the current year.
In the last two decades of its providing the services, MESCO has significantly reduced total cost to Tool and Die manufacturers by reducing purchasing cost as well as saving time on Assembly through use of its MescoPak® process. The customer base of MESCO & TVS America is common and significant synergies are expected in Marketing and cost of Operations. TVS LSL will help MESCO expand its services operations to Europe immediately and also Asian markets like Thailand & India.
R. Dinesh, Managing Director, TVS LSL said, “TVS LSL is now well placed to further consolidate its presence globally and with a unique bouquet of services, it will be a relevant knowledge partner to its existing and new customers”.
Gregg Gruizenga, CEO of MESCO said, “We are very happy to be part of the TVS Group. We believe there are very many synergies which will be realized by the acquisition of MESCO by TVS LSL and I am excited to be part of a high growth company. We are now well positioned to serve the global needs of our mutual customers.”
TVS LSL will look at further consolidating its presence in India and other Asian markets to achieve its objective to reach US$ 1 billion turnover in 2015.
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