Bengaluru-based online bus aggregator ZipGo has acquired Pune-based Supreme Trans Concepts, including its bus aggregation platforms, MetroZip and CityZip. While the amounts and details of the deal remain undisclosed, ZipGo now has a 100 percent stake in Supreme Trans Concepts. The acquisition, says ZipGo, makes it the largest technology-driven B2C bus company in India and in line with its decision to make further inroads into the electric vehicle and e-rickshaw space.
Cyril Amarchand Mangaldas, led by Rishi Anand, were the legal advisors to ZipGo, while Deloitte was the financial advisor. Ruby Capital advised Supreme Trans Concepts.
Supreme Trans Concepts has a total of 270 buses, 150 of which are used for intra-city bus services - MetroZip and CityZip. The remaining 120 buses are used to provide employees transportation services (ETS) to several IT companies in Pune, including Amdocs and WNS. With this acquisition ZipGo will get access to this entire fleet.
The MetroZip and CityZip fleet primarily consists of 36-seater, deluxe, air-conditioned buses and serve the Hinjewadi and Magarpatta areas of Pune, respectively. The ETS fleet consists of 27 and 42-seater deluxe Mercedes Benz and TATA city buses. The company employs 200 people, serves more than 23,000 customers daily and has a revenue run-rate of over Rs. 42 crore per year. Post this acquisition Co-founder Prashant Mohite will continue in his role as CEO of Supreme Trans Concepts and will take on additional responsibilities as Executive Vice President at ZipGo.
Pritesh Gupta, Co-founder and COO, ZipGo, said in a press release,
“This is our first acquisition. Supreme Trans Concepts is a clear market leader in Pune. ZipGo did not have a presence in Pune and hence this acquisition is operationally synergistic as well...The combined business is undisputedly the largest technology-driven, B2C bus company in India on all metrics including cities, fleet size, employees, rides per day, and most importantly, revenues.”
The acquisition, he said, would help them launch a Mumbai-Pune service, one of the most popular routes in India. ZipGo already operates inter-city bus services between the key hubs of Delhi-Jaipur and Bengaluru-Hyderabad.
Commenting on the benefits of the deal, ZipGo Co-founder and CEO Jitender Kumar said,
“Prashant and his team have build an impressive business in a capital-efficient manner over a short period of time. Financially, the transaction is already accretive. Additional cost synergies will be realised over the next 3-6 months by operating under the single ZipGo brand.”
Moving MetroZip to the ZipGo technology platform and centralising operational functions will further increase the profitability of the combined business, he explained, adding that the acquisition would also help them accelerate their goal of bringing electric buses to the market.
In August, ZipGo had raised funding of Rs 300 crore led by Essel Green Mobility Ltd (EGM) to help it venture into integrated transportation options including electric buses and e-rickshaws. EGM had invested Rs 200 crore in the current bus business to expand the fleet and route network and to transition to a 100-percent electric fleet. The group will invest an additional Rs 100 crore to launch e-rickshaws, a new category. The rollout will happen across different states in the next 12 months.
Founded in 2015 by Jitender Kumar, Gaurav Agarwal, and Pritesh Gupta, Zipgo had started out with a funding of $3 million led by Orios Ventures and angel investors like Nikhil Nanda, MD, Escorts Group; Rajan Anandan, Head of Southeast Asia, Google; Affan Butt, Managing Partner, Code Advisors; and Steven Laurie, Founder of US-based fund Team Builder Ventures, among others. It began operations in Bengaluru the same year.
In December 2016, ZipGo raised $6 million in Series A investment, co-led by Ventureast and Omidyar Network. Apart from ZipGo, Gurugram-based bus aggregator platform Shuttl recently raised $11 million in Series B funding led by Amazon Fund and Dentsu Ventures.