Swiggy has entered into a definitive agreement to acquire retail logistics startup LYNK Logistics Limited, in a move to expand into the retail distribution market. The acquisition is part of Swiggy’s broader strategy to become a one-stop shop for all things food and grocery.
The financial details of the acquisition have not been disclosed, although we do know that under the terms of the share swap deal, LYNK will leverage Swiggy’s strength in technology and logistics to swiftly scale its existing platform. According to filings, Ramco Cements and Ramco Industries sold their entire stakes in LYNK for an undisclosed amount to Bundl Technologies, which operates under the brand name Swiggy.
“LYNK is uniquely positioned in the retail distribution space with their brand-first, tech-led operating model and has demonstrated success with multiple FMCG brands. Our experience in supply chain and logistics gives Swiggy the unique opportunity to help LYNK scale up their offerings and empower retailers to serve their customers better,” said Sriharsha Majety, CEO of Swiggy.
Avendus Capital was the sole financial advisor to LYNK and its shareholders on this transaction, and the Chennai-based startup will continue to operate as an independent business once the deal is sealed, and continue to be led by Shekhar Bhende, the cofounder and CEO of the company.
For those who are unaware, the eight-year-old LYNK currently has a network of over 100,000 stores and is known to operate in the FMCG space. It is also known to help firms grow their retail presence by leveraging its proprietary, integrated technology platform in order to power the entire retail distribution value chain. It claims to have grown more than 2 times year-on-year with improved profitability.
“Over the last few years, we have focused squarely on helping FMCG brands to meet their retail ambitions. Given our rapid growth, we believe we are uniquely placed to lead the digitization of retail distribution in India. With Swiggy, we now hope to further accelerate our growth and double down on the tremendous opportunity before us,” Bhende said.
To date, LYNK has raised a total of $23 million, and includes the likes of Hindustan Unilever, ITC, Tata, Lakme, Pepsico, Britannia, RedBull, Mars and Dabur among its customers. With LYNK in its arsenal, Swiggy will be in a stronger position to utilize its resources towards firmly establishing itself as a dominant force in the retail distribution market, as well as expand into the sector. By leveraging LYNK’s capabilities, Swiggy will also be able to offer faster order-to-delivery turnaround, improved on-the-shelf availability, and enhanced fill rates to retail stores. The deal is also likely to improve the efficiency of the retail distribution system in India. Swiggy has a strong technology platform that can be used to improve the efficiency of the last-mile delivery process, which in turn can help retailers save money and improve their customer service, as well as grant them access to Swiggy’s technology platform.