Friday 19 August 2016

Snapdeal punched out by Pigeon Express in the acquisition of Gojavas!

Bangalore-based Pigeon Express has bought ailing logistics company GoJavas. The courier company’s director Anand Rai has taken over as GoJavas’ MD. IOS had earlier reported that there were three contenders to buy the logistics company (Pigeon, Trackon, and an unnamed third party). Pigeon was the frontrunner to bag the deal, and they have succeeded.
The transition hasn’t exactly been smooth for GoJavas’ employees. A source stated, “Starting from the chief business officer, chief of human resource operations, chief strategy officer — almost everyone has resigned. In the past few days, the senior team from Pigeon was making rounds of the office. The new management has sent out an e-mail as well, in which it says things would now be better.”
In an emailed statement to the employees of GoJavas, Rai has promised them, “All the employee remuneration and benefits will continue as usual and at no cost anyone of you will suffer.”

Sweet deal for Snapdeal

Snapdeal continues to retain its stake in the logistics company. The move seems to be a smart one, as now Snapdeal gets access to Pigeon as well.
The company is going to continue its association with GoJavas, says a person familiar with the proceedings, “The first set of orders would be from Snapdeal when operations start. Snapdeal, while it is expanding in-house logistics arm Vulcan Express, would need partners to handle the coming festive season.”
GoJavas has been having a tough time over the last few months. The company relied heavily on Snapdeal and Jabong for its business. With Flipkart taking over Jabong, its logistics requirements were routed to Flipkart’s channels. A disagreement regarding the price ensured in a tiff with Snapdeal (currently holding 42% of the share in GoJavas), and a reduction in orders from the ecommerce biggie.
All this and the receding finances had forced the logistics company to stop its operations indefinitely and let go of employees in bulk. Hopefully, the takeover will be a shot in the arm for GoJavas.

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