Private equity firm Warburg Pincus has received approval from the Competition Commission of India (CCI) to invest in trucking startup Rivigo.
The notification from the regulatory body clears the path for the New York headquartered investor to infuse capital in the technology-enabled logistics startup’s ongoing growth funding round.
The six-year-old company in November raised $11 million (Rs 84.4 crore) from returning investors Elevation Capital, an infusion that is believed to be a part of a larger growth funding round.
Elevation Capital, formerly called SAIF Partners, holds a nearly 40% stake in the company through investments from two of its funds, according to data on VCCEdge.
“CCI approves acquisition of Rivigo Services Private Limited (Rivigo) by Spring Canter Investment Ltd (SCIL) through subscription of compulsorily convertible preference shares, under Section 31(1) of the Competition Act, 2002,” the competition watchdog said in the notification.
Mauritius-based investment holding company SCIL is backed by Warburg Pincus, a returning investor in Rivigo. The private equity major first invested in the startup in 2016.
Earlier this year, the Reserve Bank of India had stated that regulated finance firms could not be set up with Foreign Direct Investment (FDI) from Mauritius and other jurisdictions that do not meet the criteria for Financial Action task Force (FATF). Though Rivigo does not have an NBFC license, it could be in the process of applying for one, much like close competitor BlackBuck, which has raised nearly $234 million so far.
Detailed email queries sent to Rivigo co-founders regarding the round did not elicit a response till the time of publishing the story.
The Gurugram headquartered company was founded in 2014 by former McKinsey executives Deepak Garg and Gazal Kalra. It provides technology-enabled trucking services, offering long-haul full truck load and partial truck load services through a driver relay model. The company operates in 10 industries, including retail, ecommerce, automotive, cold chain and FMCG.
According to annual returns filed by the company for the period between April 2018 and March 2019, it witnessed a 42% growth in revenues to Rs 1,028 crore. The company also widened its losses to Rs 602.3 crore, compared to the year-ago figure of Rs 270.2 crore.