Friday, January 4, 2008

Gateway to raise Rs 300 cr for rail freight subsidiary

Logistics provider Gateway Distriparks (GDL) is planning to raise Rs 250-300 crore by way of private equity for its subsidiary, Gateway Rail Freight.The company has appointed Kotak Bank as the merchant banker for the private placement.

The company will dilute around 15-20 per cent stake to the investor and the deal would be closed in two-three months.Gateway Rail Freight, an unlisted company, was planning to invest around Rs 1,000 crore in its rail and hinterland terminal business and acquire 30 rigs in next two years. It may list on the bourses, as well.

The company runs six freight trains and intends to double this to 12 by the end of this financial year. Starting next year, the company would add two freight trains every month.

The parent company, GDL was also planning to invest Rs 500 crore in rail logistics subsidiary in the next three years. It will make an initial investment of Rs 150 crore in acquiring rolling stock, including axles, wheels and wagons.

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