Delhivery acquires supply chain solutions start-up Algorhythm Tech in Rs 14.9-cr deal

Logistics service provider Delhivery announced it will acquire Pune-based Algorhythm Tech Pvt. Ltd. which offers planning and optimization solutions for enterprise supply chain operations.

Delhivery will pay Rs 14.9 crore for the acquisition of shares and certain other payments to outgoing management team members, the company said in a regulatory filing.

The 100 per cent acquisition will be funded from the proceeds raised through Delhivery’s initial public offer. Post the completion of the transaction, Algorhythm Tech will operate as a wholly owned subsidiary of Delhivery. The company said the transaction is expected to be completed by Jan 31, 2023.  

Founded in 2003 by Abhaya Borwankar, Ajit Singh, and Sandeep Pendurkar, Algorhythm offers end-to-end supply chain planning and execution products to clients across FMCG, pharma, steel, auto and telecom sectors, through its proprietary Rhythm 3.0 platform.  

In supply chain, its offerings include network design, inventory planning, demand planning, sales and operations planning (S&OP), logistics planning, and route planning. It also offers solutions for sales and distribution including last mile sales route planning, last mile delivery planning besides factory planning and scheduling, and manufacturing execution systems.

As per Delhivery's filings, Algorhythm had a turnover of Rs 3.6 crore in FY22. The Pune-based company’s supply chain software tools are relevant to Delhivery’s supply chain services business - both as a value added service to its customers and to drive cost optimization in service delivery, the filings said.

“Given that technology has and continues to be our core business differentiator, Algorhythm Tech’s SCM software products will enhance our Supply Chain Solutions offering with value added services and also drive cost optimization in service delivery. These SCM products are increasingly becoming vital for supply chain planning and optimization. And our clients will have the option of availing the benefits of these as part of our Integrated Solutions platform,” Sandeep Kumar Barasia, Executive Director and Chief Business Officer, Delhivery said.

Delhivery provides a full suite of logistics services such as express parcel transportation, PTL freight, TL freight, cross-border, supply chain, and technology services.