XpressBees Explores Acquisition: Engages in Early Stage Talks with Courier Platform Trackon

XpressBees Explores Acquisition: Engages in Early Stage Talks with Courier Platform Trackon

Logistics firm XpressBees is reportedly in the early stages of discussions to acquire logistics and supply chain firm Trackon, according to sources familiar with the matter. This potential acquisition comes after XpressBees recently concluded two consecutive secondary funding rounds.

Sources indicate that both XpressBees and Trackon have been engaged in discussions for the past few weeks, and the details of the deal are currently being worked out. However, the specific contours of the potential acquisition, such as the financial terms and other details, have not been disclosed.

If the acquisition proceeds, it would likely be a strategic move for XpressBees to strengthen its presence and expand its capabilities in the logistics and supply chain domain. Acquiring Trackon would provide XpressBees with additional resources, expertise, and market reach, enabling it to enhance its service offerings and cater to a broader customer base.

As discussions between XpressBees and Trackon progress, further details regarding the potential acquisition may emerge. The acquisition, if successful, would contribute to the ongoing consolidation and growth within the logistics and supply chain industry in India.

According to sources, XpressBees has established a strong presence in major metro cities and Tier 1 cities in India. With this foundation, the company is now looking to expand its services and operations in Tier III and IV cities. The potential acquisition of Trackon could play a significant role in achieving this objective.

If the acquisition proceeds, it is expected to bring several advantages to XpressBees. One key benefit would be the addition of significant scale to XpressBees’ overall revenue and operations. Moreover, Trackon’s business model, which is primarily franchise-led parcel delivery, would complement XpressBees’ existing service offerings. This could open up new avenues for growth and revenue generation for XpressBees.

Trackon claims to have a robust network of over 5,000 franchise partners across India. These franchise partners reportedly contribute over 70% of Trackon’s business. By leveraging Trackon’s extensive franchise network, XpressBees would be able to tap into the last-mile delivery capabilities and reach of Trackon in Tier III and IV cities. This would enable XpressBees to expand its reach and provide efficient logistics and supply chain services to customers in these regions.

If the potential deal between XpressBees and Trackon materializes, it would signify XpressBees’ entry into the traditional courier business that serves Micro, Small, and Medium Enterprises (MSMEs) in smaller cities. This move would allow XpressBees to expand its service offerings and cater to a broader customer base in these regions.

However, it is important to note that the talks between XpressBees and Trackon are still in the early stages, and there is no guarantee that a deal will be reached. The outcome of the discussions and the possibility of a successful acquisition will depend on various factors, including negotiations, due diligence, and agreement on financial terms.

XpressBees is known for providing a range of supply chain solutions, including B2B/B2C express delivery services, cross-border logistics, and warehousing services. These solutions cater to various industries such as e-commerce, pharmaceuticals, heavy industries, and banking institutions.

If the potential acquisition of Trackon by XpressBees materializes, it is expected to further enhance XpressBees’ capabilities, particularly in the pharmaceutical and banking segments. Trackon’s established network and expertise in these areas would complement XpressBees’ existing services, allowing the company to strengthen its offerings in these specific sectors.

XpressBees has chosen not to provide any comments on the matter, and Trackon has not responded to queries as of the publication of the story.

In terms of scale, XpressBees ranks as the third-largest new-age logistics and supply chain company in India, following Ecom Express and Delhivery. Although the company has not disclosed its financial figures for FY23, it reported a significant increase in revenue in FY22, with a nearly 90% jump to Rs 1,905 crore. Furthermore, XpressBees has made progress towards achieving break-even, as its losses reduced by 57% to Rs 27 crore in FY22.

These financial indicators suggest a positive trajectory for XpressBees, with strong revenue growth and a reduction in losses. However, it is essential to await the official disclosure of FY23 financials to gain a comprehensive understanding of the company’s recent performance and progress towards profitability.

XpressBees achieved unicorn status in February 2021 following a $300 million funding round. Since then, it has also facilitated secondary transactions worth $65 million since August 2022. These funding events have played a crucial role in boosting the company’s valuation and fueling its growth plans.

Trackon, in contrast, is an established company with a history spanning two decades. It claims to serve 5,600 pin codes across India and has ambitious plans to expand its services to cover 12,000 pin codes in the next couple of years. In FY22, Trackon reported operating revenue of Rs 283 crore, indicating a healthy performance. Notably, the company achieved profitability with Rs 8.22 crore in profits.