Redington weighs up new site in Jebel Ali
Distributor vows to find location for logistics centre before April as it celebrates recent IPO
Redington will push ahead with plans to construct a state-of-the-art distribution centre (ADC) in the Middle East following the successful completion of its recent IPO.
The Indian-based company issued 13.2 million shares in the price band of US$2.14 to US$2.55 during the four-day offering and told Channel Middle East that it expected to raise US$35m.
As we went to press, the issue had been oversubscribed 35.63 times as investors rushed to grab a stake in the region's largest IT distributor.
Redington's Gulf operation - which accounts for almost half of its business - is set to receive US$9m to strengthen its regional logistics infrastructure.
Mathew Thomas, vertical head for IT distribution at Redington Middle East and Africa, says the company is confident of selecting a location somewhere in the Jebel Ali Free Zone within the next three months.
"We are looking at the prospects at the moment," he revealed. "There are two options. We can either take land and build our own facility or there are a few properties which are already built and ready to be sold. We are looking at those to see if they could be modified to our needs. Our key priority is warehouse alignment and space. Hopefully before our new financial year on April 1st we will have made a decision," he added.
In addition to the automated distribution centre, Redington will use the IPO funds to finance an SAP ERP system that is currently being rolled out among its nine Middle East subsidiaries. "These [subsidiaries] are currently functioning independently so this will bring them all under one umbrella," explained Thomas.