CEVA Logistics, a French third-party logistics leader and a part of the CMA CGM Group, is currently present in 75 locations across 35 cities in India. With the recent announcement on the acquisition of a majority stake in Mumbai-based Stellar Value Chain Solutions, CEVA Logistics is poised to become a much stronger player in Indian contract logistics, offering its new and existing customers global expertise, increased operational efficiency and innovation. In this exclusive interview with Paras Rawal (India Managing Director, CEVA Logistics), we delve into this recent acquisition and the strategic rationale behind such a pivotal move. We explore how this acquisition aligns with CEVA’s overarching goals, the key strengths and capabilities Stellar Value Chain Solutions brings to the table, and the impact on CEVA’s market presence in India and internationally.
Could you tell us more about the strategic rationale behind CEVA’s acquisition of Stellar VCS and how it aligns with CEVA’s overall goals?
Over the years, along with our established air and ocean, we have invested and pursued our ground & rail and contract logistics businesses. This corresponds with our country’s economic growth story, driven by domestic consumption and investments as well as positive forces converging on the demand and supply sides. The growing demand for e-commerce and the changing retail consumer landscape, with its need for warehouses and third-party logistics (3PL), led us to redefine our strategic directives to align with the radically shifting customer and market dynamics.
In the future, we will leverage our synergies to strengthen our scale, scope and capabilities in contract logistics, with advancements in 3PL, to include reliable warehousing and fulfilment services, to provide a full suite of supply chain logistics solutions to our current and future customers.
Along with improved infrastructure and increased emphasis on the adoption of new technologies, CEVA will be able to implement a more sustainable business model and create efficiencies, which will also act as a backbone to support other businesses. Our focus is to craft appropriate domestic value additions and participate in the domino effect. With our network expertise, we will be able to further drive and deliver on transformation and provide our customers with better services and solutions as we work on our goal to be among the top 5 global players in the logistics industry.
What are the key strengths and capabilities that Stellar VCS brings to CEVA Logistics, and how do you plan to integrate these into your existing operations?
CEVA will acquire approximately 7,700,000 sq ft of space across 70+ facilities in 21 cities across India. Also, CEVA will inherit the Stellar workforce of nearly 8,000 full-time and temporary employees, which will enable us to build scale and diversify our presence in India. The deal to acquire Stellar is a value driver for enabling growth and increasing operational efficiency.
Along with improved infrastructure and increased emphasis on the adoption of new technologies, CEVA will be able to implement a more sustainable business model and create capabilities to support other businesses. The deal strengthens CEVA’s commitment in providing our customers with end-to-end supply chain solutions.
Could you share some insights into the impact of the Stellar VCS acquisition on CEVA’s market presence?
We see a positive economic outlook here in India, and expect trends in domestic consumption and manufacturing to serve as catalysts. These trends create a substantial opportunity to grow our business in India to capitalize on the rising domestic and global eCommerce space. With the right technology platforms and logistics support, we are all well-positioned for the expected growth. At CEVA, we look forward to using our new size and resources to further contribute to the country’s economic growth.
Integrating two companies can be challenging. How is CEVA Logistics addressing the cultural aspects and ensuring a smooth integration process post-acquisition?
CEVA Logistics, which is part of the CMA CGM group, is growing both organically and through M&A. We have a team of experts who have the right knowledge and skills to drive this integration and ensure a seamless transition. At every step, there will be adequate support and guidance to ensure the transition is a success, and new employees are welcomed into the CEVA culture.
This is an abridged interview version published in the October edition of the Logistics Insider Magazine. To read the complete interview, click here.