KKR buys India pallet pooling business
KKR has paid an undisclosed sum for a majority stake in Leap India, a supply chain services provider focused on cost reduction through pallet pooling. It sets up exits for several PE investors.
It is not clear to what extent the investment is comprised of secondary shares, but as recently as August 2021, IIFL Wealth Management (now 360 One) and Schroder Adveq Management invested USD 34m in the company.
That round provided partial exits for IndiaNivesh, Six Sense Ventures, and Mayfield Fund, which was Leap’s first investor in 2014. Concurrent with the KKR investment, Leap founder Sunu Mathew made a point of thanking Mayfield for its support without specifying there was an exit.
Earlier in 2021, Morgan Stanley Infrastructure Fund invested INR 1.8bn (USD 21.7m). TCI Ventures and Samena Capital joined a INR 2.2bn round alongside Mayfield, IndiaNivesh, and Six Sense in 2019. Previous investors also include IFMR Investments.
Founded in 2013, Leap provides equipment pooling, returnable packaging, inventory management, transportation, and repair and maintenance services to businesses across the e-commerce, consumer durables, fast-moving consumer goods, and automotive sectors.
The company is best known as a leading supplier of returnable pallets; this model allows businesses to rent or lease pallets from a shared pool rather than having to maintain their own pallet inventories. It operates 21 warehouses at more than 3,500 customer locations across India and manages more than 6m total assets, including pallets and containers.
KKR is investing as part of its Asia infrastructure strategy, noting the transaction builds on tailwinds around the modernizing, automating, and optimizing of efficiencies in supply chains and logistics services. It also described Leap as part of a trend in developing more sustainable logistics.
Ami Momaya, a director in KKR’s infrastructure business, said the company played an important role in India’s modernization and growth.
“Leap is supporting this shift by providing the critical assets needed for the manufacturing, storage, and movement of goods in supply chains and in so doing also helps companies to be better equipped to improve the environmental impact of their operations,” she said in a statement.
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