Redington Sets Agenda

Automated distribution centres planned once cash has been raised from IPO

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By  Published  October 31, 2006

Redington plans to use some of the funds from its forthcoming IPO to construct automated distribution centres in the Middle East and India.

The regional distribution giant has already submitted its IPO prospectus to the relevant authorities in India and is now awaiting formal approval to proceed.

Raj Shankar, director at Redington, stated: “The purpose of the IPO is to raise additional capital to fund the automated distribution centres to be set up in India and the Middle East and also to finance the working capital required to meet the growth of the company.

We have positioned ourselves as a supply chain solution provider with IT as one key vertical.”

He added. “Our plan going forward is to identify new verticals and establish ourselves as a formidable player and market leader.”

As part of its growth plan Redington has also embarked on an internal restructuring in the Middle East and Africa region.

Mathew Thomas has been named as vertical head for IT distribution at Redington with a geographic remit covering the Middle East, Turkey, Africa and CIS.

Simultaneously, Sumant Saran has been appointed vertical MEA head for telecoms and new projects.

Thomas explained the rationale behind Redington’s plans to construct a new distribution hub for the Middle East: “We are looking at building an automated distribution centre at Jebel Ali using some of the working capital from the IPO.

Our facilities are spread out at the moment in the UAE and this will look to bring everything under one roof.”

He said: “If you look at how a typical warehouse is operated in Jebel Ali at the moment it is just storage space.

We will look to build a highly automated warehouse that uses advanced bar coding and shipment tracking technology.

Many of the processes that are currently manual will become automated and this will reduce labour costs.”

Thomas claims the new Redington facility will be at least 100,000 square feet and says the company has already been given approval for the land it has applied for in Jebel Ali.

“It will probably take 18 months to get this new facility up and running.

Our in-country stocking points will continue to operate but they will be supplied on a just-in-time basis from the central warehouse in Jebel Ali,” said Thomas.

Redington is also growing at a rapid rate in terms of the products it carries.

It has just extended a deal with Samsung to go regionwide and recently picked up Western Digital rights for KSA.

The distribution powerhouse has also been awarded Cisco rights in Nigeria — a deal that underscores the scale of its African ambition.

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