Amazon acquires Indian retail startup Perpule

Amazon has acquired a startup in India that is helping offline stores go online, the e-commerce group’s latest attempt to make inroads in the world’s second most populous nation where brick and mortar continue to drive more than 95% of sales.

The American e-commerce group said on Tuesday evening that it has acquired Perpule, a four-year-old startup. A regulatory filing showed Amazon Technologies paid $14.7 million to acquire the Indian startup in an all-cash deal. The company is expected to spend an additional $5 million or so to compensate Perpule’s employees.

Perpule, which had raised $6.36 million (per insight platform Tracxn), offers a mobile payments device (point of sale machine) to offline retailers to help them accept digital payments and also establish presence on various mini app stores including those run by Paytm, PhonePe, and Google Pay in India.

“Perpule has built an innovative cloud-based POS offering that enables offline stores in India to better manage their inventory, checkout process, and overall customer experience,” an Amazon spokesperson said in a statement.

“We are excited to have the Perpule team join us to focus on providing growth opportunities for businesses of all sizes in India while raising the bar of the shopping experience for Indian customers.”

Founded in late 2016, the Indian startup’s first product was focused on helping customers avoid queues at super chains such as Shoppers Stop, Spar Hypermarket, Big Bazaar, and More. But the product, said Abhinav Pathak in a recent interview, wasn’t scaling, which is when Perpule pivoted.

The startup — which counts Prime Venture Partners, Kalaari Capital, and Raghunandan G (founder of neobank Zolve) among its investors — has further expanded in recent years, launching products like StoreSE, which enables a business to support group ordering.

Last year, it also expanded geographically; bringing its offerings to Southeast Asian markets including Indonesia, Malaysia, Thailand, Singapore, and Vietnam.

Amazon has aggressively engaged with physical stores in India in recent years, using their vast presence in the nation to expand its delivery network and warehouses and even just relying on their inventory to drive sales.

The company’s push into physical retail comes as Flipkart, and Reliance Jio Platforms (backed by Facebook and Google), which last year raised over $20 billion, also race to capture this market. The acquisition of Perpule comes less than a week after Google backed DotPe, a startup that offers several similar products.

These neighborhood stores offer all kinds of items, are family-run and pay low wages and little to no rent. Because they are ubiquitous — there are more than 30 million neighborhood stores in India, according to industry estimates — no retail giant can offer a faster delivery. And on top of that, their economics are often better than most of their digital counterparts.

#amazon, #asia, #dotpe, #dukaan, #ecommerce, #facebook, #fundings-exits, #google, #jio-platforms, #khatabook, #okcredit, #reliance-retail

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Forget winning, can Amazon survive in India?

During a visit to India in 2014, Amazon chief executive Jeff Bezos made a splashy announcement: His firm was investing $2 billion in the South Asian nation, just a year after beginning operations in the country.

Amazon’s announcement underscored how far India had come to open up to foreign firms. The nation, which had largely kept doors shut to international giants between its independence in 1947 to liberalization in 1991, has slowly transformed itself into the world’s largest open market.

In a televised interview in 2014, Bezos said that there was a perception about India not being an easy place to do business. But Amazon’s growth in the country, he said, was proof that this belief is not accurate.

“Are there obstacles? There are always obstacles. Anywhere you go, every country has its own regulations and rules,” he said.

Six years, and more than $4.5 billion of additional investments later, Amazon today appears to be facing more obstacles than ever in India, the second-largest internet market with more than 600 million users.

Long-standing laws in India have constrained Amazon, which has yet to turn a profit in the country, and other e-commerce firms to not hold inventory or sell items directly to consumers. To bypass this, firms have operated through a maze of joint ventures with local companies that operate as inventory-holding firms.

India got around to fixing this loophole in late 2018 in a move that was widely seen as the biggest blowback to the American firm in the country at the time. Amazon and Walmart-owned Flipkart scrambled to delist hundreds of thousands of items from their stores and made their investments in affiliated firms way more indirect.

Now the nation is set to further toughen this approach. Reuters reported last week that New Delhi is considering making adjustments to some provisions that would prevent affiliated firms to hold even an indirect stake in a seller through their parent.

The Confederation of All India Traders, an Indian trade body that claims to represent over 80 million businesses, told the publication that Indian Commerce Minister Piyush Goyal has assured the organization that it is working to shortly address concerns about alleged violations of current rules.

The forthcoming policy change is only one of the many headaches for the world’s largest e-commerce firm in India.

Offline retailers in India have long expressed concerns about what they allege to be unfair practices employed by Amazon in India. Last year, during Bezos’ visit to the country, they held several protests. (Photo by SAJJAD HUSSAIN/AFP via Getty Images)

Amazon is aggressively fighting a battle to block a deal between its estranged partner Future Group and Reliance Retail, the two largest retail chains in India.

Last year, Future Group announced that it would sell its retail, wholesale, logistics and warehousing businesses to Reliance Retail for $3.4 billion. Amazon, which in 2019 bought stakes in one of Future Group’s unlisted firms, says that the Indian firm has breached its contract (which would have given Amazon the right to first refusal) and engaged in insider trading.

Despite technology giants and investors ploughing more than $20 billion to create an e-commerce market in India in the past decade, online retail still accounts for only a single-digit pie of all retail in the country.

In recent years, Amazon, Walmart and scores of other startups have embraced this realization and sought to work with neighborhood stores that dot tens of thousands of cities, towns and villages in India.

With Reliance Retail and telecom giant Jio Platforms, two subsidiaries of one of India’s largest corporates (Mukesh Ambani’s Reliance Industries) entering the e-commerce market, and receiving the backing of global giants including Facebook and Google last year, cornering a big stake in Future Group is one of the few ways Amazon can accelerate its growth in India.

The American e-commerce firm has had little luck so far in overturning the deal between the Indian firms. Last year, Amazon reached out to Indian antitrust body Competition Commission of India, and market regulator SEBI to block this transaction. Both the bodies have ruled in favor of Future Group and Reliance Retail.

Amazon must have foreseen this outcome because it initiated the legal proceedings at an arbitration court in Singapore. It’s no surprise that the firm chose to also pursue its legal argument outside of India.

Most cases that reach the Singapore International Arbitration Court have come from India in recent years. Vodafone, which has invested more than $20 billion in India, and has been dealt with billions of dollars in unpaid taxes by the country, is another high-profile name to have knocked on the door in Singapore. After losing in India, it emerged victorious in the Singapore arbitration court last year.

Amazon on Monday filed a new petition in Delhi High Court in which it is seeking to enforce SIAC’s ruling (which ordered last year that the deal should be temporarily halted) and prevent the Indian firm from going ahead with the deal based on CCI and SEBI’s judgements.

The company alleges that Future Group “deliberately and maliciously” disobeyed the international arbitration ruling from SIAC. In its petition, Amazon is also seeking detention of Kishore Biyani, the founder and chairman of Future Group.

“Vocal for Local”

As India grappled with containing the spread of the coronavirus last year, India’s Prime Minister Narendra Modi urged the 1.3 billion citizens to make the country “self-reliant” and “be vocal for local.”

The move to turn inwards contrasts with his major promise in the first few years of assuming power in 2014 when he pledged to make India more welcoming to foreign firms than before. In recent years, India has proposed or enforced several regulations that hurt American firms, though none appear to suffer as much as Amazon.

Last year, New Delhi started to enforce a 2% tax on all foreign billings for digital services provided in the country. The U.S. Trade Representative said earlier this month that India was taxing numerous categories of digital services that are “not leviable under other digital services taxes adopted around the world.”

The aggregate tax bill for U.S. companies could exceed $30 million per year in India, USTR’s investigation found. In conclusion, it found India’s digital tax move to be inconsistent with international tax principles, unreasonable and burdening or restricting U.S. commerce.

Modi’s new way of life for India will be music to the ears of Mukesh Ambani, the chairman of Reliance Industries, an ally of the prime minister and India’s richest man.

Before selling stakes worth over $20 billion in Jio Platforms and more than $6 billion in Reliance Retail to marquee foreign investors, Ambani famously made a speech in 2019 in which he urged the need to protect Indians’ data in patriotic terms.

“We have to collectively launch a new movement against data colonization. For India to succeed in this data-driven revolution, we will have to migrate the control and ownership of Indian data back to India — in other words, Indian wealth back to every Indian,” he said.

Why so many international firms have invested in one of Reliance’s properties remains a big question. A senior executive at an American firm told TechCrunch on the condition of anonymity (out of fear of retribution) that the investments in Jio Platforms, which is India’s largest telecom network with nearly 410 million subscribers, and Reliance Retail is a déjà vu moment for the nation, where a few decades ago one of the only ways to do business in the nation was to partner with a local firm with massive political clout.

In a series of tweets, Raman Chima, a former policy executive at Google and who now works at nonprofit digital advocacy group Access Now, alleged that the Android-maker had weighed in 2011-12 partnering and investing in a firm like Reliance to “turn-the-page on Indian political risks.”

The idea prompted concerns about Google’s values, he claimed. “More than one executive involved in those discussions flagged concerns around Reliance’s reputation, particularly around problematic approaches towards gaining influence with policymaking civil servants and politicians, money, ethics in govt-business relationships.”

Amazon itself was rumored to be interested in getting a multi-billion-dollar stake in Reliance Retail last year, but it appears the two firms have stopped engaging on any matter.

BJP MLA Ram Kadam and his party workers protest against the Amazon Prime web series Tandav outside Bandra-Kurla Police station, on January 18, 2021 in Mumbai, India. (Photo by Pratik Chorge/Hindustan Times via Getty Images)

While Amazon sorts out these issues, last week delivered another blow to the firm. A senior executive with the firm as well as Indian makers of a mini-series for Amazon Prime Video are under threat of criminal prosecution in the country after Modi’s ruling party deemed the show offensive to the country’s Hindu majority.

A Hindu nationalist group, politicians with the ruling Bharatiya Janata Party, and a BJP group representing members of India’s lower castes, were among those who had filed police reports against the nine-part mini-series “Tandav” and Amazon. The company bowed to the pressure and edited out some scenes.

“The true reason for the complaints against ‘Tandav’ may be that the show holds up a mirror uncomfortably close to Indian society and some of the problems blamed on Mr. Modi’s administration. In the opening episode, the show features protesting students and disgruntled farmers, echoing events that have taken place in recent months,” The New York Times wrote.

“Mirzapur,” another show of Amazon, also attracted a criminal complaint in India last week for hurting religious and regional sentiments and defaming the Indian town. The Indian Supreme Court has issued notices to the makers of “Mirzapur” and has sought responses.

In the aforementioned interview, Bezos said Amazon’s job was to follow all the unique rules various countries require it to comply with and “adapt our business practice to those rules.”

In India, the company is increasingly being asked how far it is willing to adapt its business practice. How far is it willing to bend that it’s no longer the Amazon people cared for.

#amazon, #amazon-india, #amazon-prime-video, #apps, #asia, #ecommerce, #entertainment, #flipkart, #government, #india, #jio-platforms, #reliance-industries, #reliance-jio, #reliance-retail, #walmart

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Indian stock exchanges approve $3.4B Reliance and Future deal in setback for Amazon

Indian stock exchanges approved the $3.4 billion deal between retail giants Reliance Retail and Future Group on late Wednesday in yet another setback for Amazon, which has invested over $6.5 billion in the world’s second largest internet market and sought to block the aforementioned deal.

The Bombay Stock Exchange said in a notification that it had spoken with India’s markets regulator, the Securities and Exchange Board of India (SEBI), and had no objection or adverse observation on the deal.

Wednesday’s notification is the latest setback for Amazon, which had written to SEBI and Indian antitrust watchdog to block the multi-billion deal between Future Group and Reliance Retail, the two largest retail chains in India. Last year, India’s antitrust group gave a go ahead to the deal to the Indian firms.

“We hereby advise that we have no adverse observations with limited reference to those matters having a bearing on listing/de-listing/continuous listing requirements within the provisions of Listing Agreement, so as to enable the company to file the scheme with Hon’ble NCLT [National Company Law Tribunal],” the notification read. SEBI has advised Future to share various aspects of its ongoing litigation with Amazon to NCLT, whose approval for the deal is pending.

Amazon bought 49% stake in one of Future’s unlisted firms in 2019 in a deal that was valued at over $100 million. As part of the deal, Future could not have sold assets to rivals, Amazon has said in court filings.

Things changed last year after the coronavirus pandemic starved the Indian firm of cash, Future Group chief executive and founder Kishore Biyani said at a recent virtual conference. In August, Future Group said that it had reached an agreement with Ambani’s Reliance Industries, which runs India’s largest retail chain, to sell its retail, wholesale, logistics and warehousing businesses for $3.4 billion.

Amazon later protested the deal by reaching an arbitrator in Singapore and asked the court to block the deal between the Indian retail giants. Amazon secured emergency relief from the arbitration court in Singapore in late October that temporarily halted Future Group from going ahead with the sale.

The two estranged partners also fought at the Delhi High Court last year, which in a rare glimmer of hope for the American giant rejected Future’s plea for an ad-interim injunction to restrain Amazon from writing to regulators and other authorities to raise concerns over — and halt — the deal between the two Indian giants.

An Amazon spokesperson told TechCrunch that the firm will continue to pursue legal remedies. “The letters issued by BSE & NSE clearly state that the comments of SEBI on the ‘draft scheme of arrangement’ (proposed transaction) are subject to the outcome of the ongoing Arbitration and any other legal proceedings. We will continue to pursue our legal remedies to enforce our rights,” the spokesperson said.

At stake is India’s retail market that is estimated to balloon to $1.3 trillion by 2025, up from $700 billion in 2019, according to consultancy firm BCG and local trade group Retailers’ Association India. Online shopping accounts for about 3% of all retail in India.

#amazon, #amazon-india, #asia, #ecommerce, #future-group, #future-retail, #reliance-industries, #reliance-retail

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Jumbotail raises $14.2 million for its wholesale marketplace in India

Jumbotail, an online wholesale marketplace for grocery and food items, said on Friday it has raised an additional $14.2 million as the Bangalore-based startup chases the opportunity to digitize neighborhood stores in the world’s second largest internet market.

The five-year-old startup said the new tranche of its Series B financing round was led by VII Ventures, with participation from Nutresa, Veronorte, Jumbofund, Klinkert Investment Trust, Peter Crosby Trust, Nexus Venture Partners, and Discovery Ventures.

The startup told TechCrunch that the new tranche concludes its Series B round, which it kickstarted in 2019 with a tranche of $12.7 million. It ended up raising about $44 million in the Series B round (including Friday’s tranche), and to date has amassed about $54 million in equity investment, the startup told the publication.

Jumbotail said it serves over 30,000 neighborhood stores (popularly known in India as kiranas) in the country. In addition to its business-to-business marketplace, the startup also provides working capital to neighborhood stores through partnerships with financial institutions.

The startup, which has built its own supply chain network to enable last-mile delivery, also supplies these stores with point-of-sale devices so that they can easily get access to a much wider selection of catalog and have the new inventory shipped to them within two days. It also integrates these stores with hyperlocal delivery startups such as Dunzo and Swiggy to help mom and pop shops further expand their customer base.

Ashish Jhina, co-founder of Jumbotail, said he believes the startup has reached an inflection point in its growth and is now ready for its next chapter, which includes hiring top talent and expanding to more regions in the country, especially in several cities in South India.

“We are seeing tremendous interest from investors across the globe who are drawn to our highly scalable and operationally profitable business model, built on the industry’s best technology and customer NPS,” said Jhina, who previously served in Indian army and then worked at e-commerce firms eBay and Flipkart.

At a recent virtual conference, Jhina said that the coronavirus pandemic, which prompted New Delhi to order a nationwide lockdown and put restrictions on e-commerce firms, has illustrated just how crucial neighborhood stores are in people’s lives. And for all the ills that the virus has wrought to the world, it did help accelerate the adoption of technology among these stores.

A number of food brands whose products neighborhood stores sell today are not standardized, which poses a question about their quality. To fill this gap, Jumbotail runs its own private label portfolio and Jhina said the startup will deploy part of the fresh fund to broaden this catalog. Having private label also allows Jumbotail to ensure that its retail partners can get the supply of items throughout the year — and of course, it also helps the startup, which has been operationally profitable for nearly three quarters, improve its margin.

There are more than 30 million neighborhood stores in India that dot across the thousands of cities and towns in the country. These small businesses have been around for decades and survived — and even thrived — despite e-commerce giants pouring billions of dollars in India to change how people shop. In recent years, scores of startups — and giants — in India have begun to explore ways to work with these neighborhood stores.

One of them is India’s largest retail chain Reliance Retail, which serves more than 3.5 million customers each week through its nearly 10,000 physical stores in more than 6,500 cities and towns in the country. In late 2019, it entered the e-commerce space with JioMart through a joint venture with sister subsidiary telecom giant Jio Platforms. By mid last year, JioMart had expanded to over 200 Indian cities and towns — though currently its reach within those cities and customer service leave a lot to be desired.

Reliance Retail also maintains a partnership with Facebook for WhatsApp integration. Facebook, which invested $5.7 billion in Jio Platforms last year, has said that it will explore various ways to work with Reliance to digitize the nation’s mom and pop stores, as well as other small- and medium-sized businesses.

For JioMart, Reliance Retail is working with neighborhood shops, giving them a digital point-of-sale machine to make it easier for them to accept money electronically. It is also allowing these shops to buy their inventory from Reliance Retail, and then use their physical presence as delivery points. At present, the platform is largely focused on grocery delivery. In a recent report to clients, Goldman Sachs analysts estimated that Reliance could become the largest player in online grocery within three years.

#asia, #ecommerce, #food, #funding, #india, #jio-platforms, #nexus-venture-partners, #reliance-retail

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India approves Reliance’s $3.4 billion deal with Future Group, brings a new headache to Amazon

The Indian watchdog said on Friday it has approved the $3.4 billion deal between the nation’s two largest retail giants, Future Group and Reliance Retail, posing a new headache for American e-commerce group Amazon in the key overseas market.

The Competition Commission of India (CCI), the Indian watchdog, said in a brief statement that it had approved the proposed acquisition of retail, wholesale, logistics, and warehousing businesses of Future Group, India’s second largest retail chain, by Reliance Retail, the largest.

Reliance Retail and Future Group announced their proposed deal, worth $3.4 billion, in late August. Amazon, which owns a stake in a Future Group’s subsidiary, has protested the deal, alleging the Indian firm of engaging in insider trading and violating contracts.

Late last month, a Singapore arbitration court issued an order to temporarily halt the deal between the two Indian retail giants, but it has been unclear ever since how much water that order holds in India. Shortly after the court issued the order, Future Group and Reliance Retail said they were working to complete their deal “without any delay.”

Friday’s announcement is crucial. Amazon, which has invested over $6.5 billion in its India business, had requested the CCI and SEBI, the regulator of the securities and commodity market in India, to consider Singapore International Arbitration Centre’s order and block the deal.

Future Group is currently fighting with Amazon in a court in Delhi, where a lawyer for the Indian firm has used bizarre language to charge the American firm. On several occasions, the lawyer has likened Amazon’s effort to block Future Group’s deal to the East India Company, the British trading house whose arrival in India kicked off nearly 200 years of colonial rule.

Amazon did not immediately respond to a request for comment.

More to follow…

#amazon, #amazon-india, #asia, #ecommerce, #future-group, #government, #mukesh-ambani, #reliance, #reliance-retail

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Reliance Retail buys Urban Ladder for $24.4 million

Reliance Retail has acquired a majority stake in furniture and decor platform Urban Ladder, making a broader push into e-commerce as the largest retail chain in India gears up to fight Amazon and Flipkart.

In a filing to the local stock exchange, Reliance Retail said it had acquired a 96% stake in Urban Ladder for about $24.43 million. The Indian retail giant, which retains the option to acquire the remainder stake in the seven-and-a-half-years-old startup, said it has proposed to invest up to $10.06 million more in Urban Ladder by December 2023.

Founded in early 2012, Urban Ladder sells home furniture and decor products online. It also operates a chain of physical retail stores in several Indian cities. The deal size suggests that it was a fire sale.

The startup had raised about $115 million from Sequoia Capital, SAIF Partners, Steadview Capital, and MIT and other investors, according to Crunchbase and Tracxn. In the financial year that ended in March, the Indian startup reported a loss of $6.63 million on a turnover of $58.2 million.

Reliance Retail said (PDF) the investment “will further enable the group’s digital and new commerce initiatives and widen the bouquet of consumer products provided by the group, while enhancing user engagement and experience across its retail offerings.”

Urban Ladder is the latest acquisition for Reliance Retail, which earlier this year said it had entered into a $3.4 billion deal with Future Group to buy several of India’s second largest retail chain’s businesses. In August, Reliance acquired a 60% stake in pharma marketplace Netmeds’ parent firm Vitalic for about $83.2 million.

Reliance Retail, which is part of Reliance Industries (India’s most valued firm), has raised about $6.4 billion in recent months after its sister subsidiary, Jio Platforms, secured over $20 billion this year from Facebook and Google among other high-profile investors.

Reliance Retail, which serves more than 3.5 million customers each week through its nearly 10,000 physical stores in more than 6,500 cities and towns in the country, entered the e-commerce space with JioMart through a joint venture with Jio Platforms. JioMart now has a presence in over 200 Indian cities and towns, and it also maintains a partnership with Facebook for WhatsApp integration.

#amazon, #amazon-india, #asia, #ecommerce, #flipkart, #fundings-exits, #india, #reliance-retail, #urban-ladder, #walmart

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Reliance Retail raises $1.3 billion from PIF

The Public Investment Fund, which has this year invested $1.5 billion in Mukesh Ambani’s telecom venture Jio Platforms and more than half a billion dollars in his fiber-optic business, has returned to back yet another empire built by India’s richest man.

The sovereign wealth fund is investing $1.3 billion in Reliance Retail for a 2.04% equity stake in the largest retail chain in India. The investment values Reliance Retail, which was founded in 2006, at $62.4 billion (up from about $58 billion last month), the Indian firm said.

Reliance Retail, which serves more than 3.5 million customers each week (as of early this year) through its nearly 10,000 physical stores in more than 6,500 cities and towns in the country, has now raised over 6.4 billion since September this year.

“We at Reliance have a long-standing relationship with the Kingdom of Saudi Arabia. PIF is at the forefront of the economic transformation of the Kingdom of Saudi Arabia. I welcome PIF as a valued partner in Reliance Retail and look forward to their sustained support and guidance as we continue our ambitious journey to transform India’s retail sector for enriching the lives of 1.3 billion Indians and millions of small merchants,” said Ambani, who runs Reliance Retail’s parent firm, Reliance Industries, in a statement. 

More to follow…

#asia, #funding, #india, #jio-platforms, #reliance-industries, #reliance-retail

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Reliance says its $3.4 billion deal with Future Group ‘fully enforceable under Indian law’ despite Amazon winning an arbitration order

Reliance Retail, India’s largest retail chain, said on Sunday evening that its proposed deal to acquire Future Group’s assets for $3.4 billion — against which Amazon has filed a legal proceeding — is fully enforceable under the Indian law and it intends to complete the deal “without any delay.”

Mukesh Ambani’s firm issued the statement after Amazon won an emergency order from a Singapore arbitration panel to temporarily halt the proposed sale between the two Indian retail giants.

The American e-commerce group, which indirectly bought a 3.58% stake in Future Group’s Future Retail business last year, reached out to a Singapore arbitration panel over the multi-billion dollar proposed deal.

Amazon’s deal with Future Retail had given the American e-commerce giant the first right to refusal on purchase of more stakes in Future Retail, the Indian firm had said at the time. Amazon, Walmart’s Flipkart, and Reliance Industries, the most valuable firm in India, are locked in an intense battle to shape how hundreds of millions of Indians would shop in the future.

In a statement, an Amazon spokesperson said the company was “grateful for the order which grants all the reliefs that were sought. We remain committed to an expeditious conclusion of the arbitration process.”

At the moment, it is unclear whether today’s injunction is enforceable in India. Indeed, in a statement, a Reliance Industry spokesperson said that Reliance Retail’s transaction for acquisition of assets and business of Future Retail were conducted under “proper legal advice” and the “rights and obligations are fully enforceable under Indian law.”

Reliance Retail “intends to enforce its rights and complete the transaction in terms of the scheme and agreement with Future group without any delay,” the spokesperson added.

The legal proceeding in Singapore has come as a surprise to many in the industry, as Amazon is said to be preparing to acquire a multi-billion-dollar stake in Reliance Retail, according to earlier reports by ET Now and Bloomberg.

With e-commerce commanding only between 3 -7% of all retail sales in India — and Reliance Retail launching its own e-commerce business to fight Amazon and Flipkart — Amazon’s reported future deal with Reliance Retail is already been seen by many industry analysts as crucial for the American e-commerce firm’s future in India. Amazon, which kickstarted its journey in India seven years ago, has invested more than $6.5 billion in its local business in the country.

Founded in 2006, Reliance Retail serves more than 3.5 million customers each week (as of early this year) through its nearly 12,000 physical stores in more than 6,500 cities and towns in the country.

The retail chain, run by India’s richest man, Mukesh Ambani, has raised about $5.14 billion by selling about an 8.5% stake in its business to Silver Lake, Singapore’s GIC, General Atlantic and others in the past two months.

Ambani’s other venture, Jio Platforms, this year raised over $20 billion from more than a dozen marquee investors, including Google and Facebook.

 

#amazon, #asia, #ecommerce, #flipkart, #future-group, #india, #mukesh-ambani, #reliance-industries, #reliance-retail, #walmart

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Amazon sends legal notice to India’s Future Group over deal with Ambani’s Reliance Retail

Amazon has sent a legal notice to Future Retail, India’s second largest retail chain, for breaching the terms of its contract by selling a significant portion of the business to Ambani’s Reliance Retail.

Future Group announced in late August that it was selling its retail and wholesale business, as well as its logistics and warehousing business to Reliance Retail for $3.4 billion.

But before Reliance Retail came into the picture, Future Group and Amazon also had a deal.

Last year, Amazon acquired a 49% stake in Future Coupons, a group entity owned by Future Group’s retail business. The deal gave Amazon a 3.58% stake in Future Retail, and the right of first refusal to purchase more stake in Future Retail both directly as well as via entities, Future Group said in a filing at the time.

According to TV network ET Now, which first reported about the legal notice, the deal between Amazon and Future Retail also restricted the Indian firm from entering into a deal with certain firms.

Future Group, which kickstarted its journey as a stonewashed-fabric seller in the 1980s, served millions of customers through more than 1,500 stores in more than 400 cities as of earlier this year.

The legal notice has puzzled many in India, as Amazon is reportedly preparing to acquire a multi-billion-dollar stake in Reliance Retail, India’s largest retail chain, according to earlier reports by ET Now and Bloomberg.

With e-commerce commanding only between 3 to 7% of all retail sales in India — and Reliance Retail launching its own e-commerce business to fight Amazon and Flipkart — Amazon’s deal with Reliance Retail is seen as crucial for the American e-commerce firm’s future in India by many industry analysts. Amazon, which kickstarted its journey in India seven years ago, has invested over $6.5 billion in its local business in the country.

Amazon confirmed that it had filed a legal notice. Reliance Retail and Future Group did not comment. As of Wednesday midnight (local time), Future Group had not disclosed the notice on the stock exchange.

Founded in 2006, Reliance Retail serves more than 3.5 million customers each week (as of early this year) through its nearly 12,000 physical stores in more than 6,500 cities and towns in the country.

The retail chain, run by India’s richest man Mukesh Ambani, has raised about $5.14 billion by selling about an 8.5% stake in its business to Silver Lake, Singapore’s GIC, General Atlantic and others in the past four weeks.

Ambani’s other venture, Jio Platforms, this year raised over $20 billion from more than a dozen marquee investors including Google and Facebook.

#amazon, #amazon-india, #asia, #future-group, #india, #reliance-retail

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Ambani sells over $750 million Reliance Retail stake to Abu Dhabi Investment Authority

Abu Dhabi Investment Authority, which invested $750 million in Indian telecom giant Jio Platforms in June this year, has returned to invest just as much capital in Mukesh Ambani’s other venture.

Reliance Retail, India’s largest retail chain, said on Tuesday that it is selling a 1.2% stake in the business to Abu Dhabi Investment Authority for about $752 million. Abu Dhabi Investment Authority is the seventh investor to secure a stake in Reliance Retail — at a pre-money valuation of $58.5 billion — in the past one month.

Reliance Retail, a subsidiary of Reliance Industries (India’s most valuable firm), has raised about $5.14 billion by selling about 8.5% stake in its business to Silver Lake, Singapore’s GIC, General Atlantic and others. Mukesh Ambani, who controls Reliance Industries, said in July that he was looking to sell stakes in Reliance Retail to investors. Earlier this year, Jio Platforms raised about $20 billion from more than a dozen high-profile investors including Facebook and Google.

Founded in 2006, Reliance Retail serves more than 3.5 million customers each week (as of early this year) through its nearly 12,000 physical stores in more than 6,500 cities and towns in the country. Reliance Retail operates supermarkets, electronics chain, fashion outlets and a cash-and-carry wholesaler. In recent months, the firm has rushed to widen its dominance in the retail market. It bought several parts of Future Group, India’s second largest retail chain, for $3.4 billion in late August.

Late last year, it also entered the e-commerce space with JioMart. JioMart, a joint venture between Reliance Retail and Jio Platforms, has presence in over 200 Indian cities and towns, and maintains a partnership with Facebook for WhatsApp integration. Facebook, which invested $5.7 billion in Jio Platforms earlier this year, has said it will explore various ways to work with Reliance to digitize the nation’s 60 million mom and pop stores as well as other small and medium-sized businesses.

“Reliance Retail has rapidly established itself as one of the leading retail businesses in India and, by leveraging both its physical and digital supply chains, is strongly positioned for further growth. This investment is consistent with our strategy of investing in market leading businesses in Asia linked to the region’s consumption-driven growth and rapid technological advancement,” said Hamad Shahwan Aldhaheri, Executive Director of the Private Equities Department at ADIA, in a statement.

Physical retail commands about 97% of all retail sales in India, according to estimates from several research firms.

#asia, #funding, #india, #jio-platforms, #reliance-industries, #reliance-retail, #tc

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Singapore’s GIC and TPG to invest $1 billion in Reliance Retail

GIC, Singapore’s sovereign wealth fund, will invest $752 million in Mukesh Ambani’s Reliance Retail, and TPG will invest $250 million in the Indian firm, they all said Saturday midnight (local time).

The Government of Singapore Investment Corp and TPG are the latest high-profile investors to back Reliance Retail, India’s largest retail chain, in the past four weeks. Reliance Retail — like its sister sibling Jio Platforms — is a subsidiary of Reliance Industries, India’s most valuable firm.

GIC’s andd TPG’s investments give Reliance Retail a pre-money valuation of $58.5 billion, the Indian firm said. GIC, which has backed firms in over 40 nations, will get a 1.22% equity stake in the retail giant, while TPG will secure 0.41% stake, they said.

The announcement today caps a busy week for Reliance Retail, which in the past three days has revealed that Mubadala ($855 million for a 1.4% stake), Silver Lake ($254 million for a 0.38% stake), and General Atlantic ($498 million for a 0.84% stake) would also be investing in it.

In total, investors have committed about $4.4 billion in Reliance Retail in the current fundraising spree. (Silver Lake committed to invest another $1 billion in Reliance Retail last month, and KKR has announced it would invest about $754 million.)

Reliance Retail, founded in 2006, serves more than 3.5 million customers each week (as of early this year) through its nearly 12,000 physical stores in more than 6,500 cities and towns in the country. Physical retail commands about 97% of all retail sales in India, according to estimates from several research firms.

“We believe Reliance Retail will continue to use its extensive supply chain and store networks, as well as strong logistics and data infrastructure, to add value to its customers and shareholders,” said Lim Chow Kiat, CEO of GIC, in a statement.

Reliance Retail operates supermarkets, electronics chain, fashion outlets, and a cash-and-carry wholesaler. In recent months, the firm has rushed to widen its dominance in the retail market. It bought several parts of Future Group, India’s second largest retail chain, for $3.4 billion in late August.

Late last year, it also entered the e-commerce space with JioMart. JioMart, a joint venture between Reliance Retail and Jio Platforms, has presence in over 200 Indian cities and towns and maintains a partnership with Facebook for a WhatsApp integration.

Facebook, which invested $5.7 billion in Jio Platforms earlier this year, has it will explore various ways to work with Reliance to digitize the nation’s 60 million mom and pop stores as well as other small and medium-sized businesses.

Jio Platforms has raised more than $20 billion in India this year from a roster of marquee investors including Facebook, Google, General Atlantic, Mubadala, Silver Lake, and KKR. Some industry executives have argued that investments in Jio Platforms make no business case and is largely foreign firms’ push to get friendly with Ambani, India’s richest man and an ally of Prime Minister Narendra Modi.

“I am delighted that GIC, with its track record of close to four decades of successful long-term value investing across the world, is partnering with Reliance Retail in its mission to transform the Indian retail landscape. GIC’s global network and track record of long-term partnerships will be invaluable to the transformation story of Indian Retail. This investment is a strong endorsement of our strategy and India’s potential,” said Mukesh Ambani, Chairman and Managing Director of Reliance Industries, in a statement.

The story was updated at 2.15 am IST to include details about TPG’s investment.

#amazon, #asia, #funding, #gic, #india, #jio-platforms, #reliance-retail

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Reliance Retail to raise $1 billion from Silver Lake

Indian billionaire Mukesh Ambani’s retail venture Reliance Retail said on Wednesday it will raise $1.02 billion from Silver Lake, kickstarting a fundraising spree months after its sister venture Jio Platforms raised $20 billion earlier this year.

The investment in Reliance Retail will grant Silver Lake a 1.75% equity stake in India’s largest retail chain. The deal values Reliance Retail at $57 billion pre-money, its parent firm Reliance Industries said in a statement.

Reliance Retail, which last month acquired several parts of Future Group (India’s second largest retail chain), has 12,000 stores across the country. In the financial year that ended in March, it reported a net profit of $726.4 million. In recent quarters, Oil-to-retail giant Reliance Industries has looked to further expand the reach of Reliance Retail by entering e-commerce space.

JioMart, a joint venture between Jio Platforms and Reliance Retail, has presence across 200 cities and towns in India.

“The success of JioMart in such a short time span, especially while India, along with the rest of the world, battles the COVID-19 pandemic, is truly unprecedented, and the most exciting growth phase has just begun. Reliance’s New Commerce strategy could become the disruptor of this decade. We are thrilled to have been invited to partner with Reliance in their mission for Indian Retail,” said Egon Durban, Co-CEO and Managing Partner of Silver Lake, in a statement.

Today’s announcement widens the bet Silver Lake has made on Ambani, India’s richest man. The Menlo Park-headquartered PE firm also invested $1.35 billion in Jio Platforms earlier this year. On Tuesday, it led a $500 million investment round in Indian edtech giant Byju’s.

“I am delighted to extend our relationship with Silver Lake to our transformational efforts of building an inclusive partnership with millions of small merchants while providing value to Indian consumers across the country in the Indian retail sector. We believe technology will be key to bringing the much-needed transformation in this sector so that various constituents of the retail ecosystem can collaborate to build inclusive growth platforms. Silver Lake will be an invaluable partner in implementing our vision for Indian Retail,” said Ambani in a statement.

#asia, #funding, #india, #reliance-jio, #reliance-retail, #silver-lake

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India’s Reliance Retail to acquire Future Group’s retail, wholesale, and logistics businesses for $3.4 billion

Reliance Retail, India’s largest retail chain, has found a much simpler way to expand its dominant position in the country: Acquire most of the second largest chain’s units.

On Saturday evening (local Indian time), Reliance Retail said it has reached an agreement with Future Group to acquire the latter’s retail and wholesaler business, and its logistics and warehousing business for $3.4 billion.

The announcement today further complicates the future of Amazon and Walmart’s Flipkart in India where e-commerce sill accounts for just 3% of all retail sales. Amazon, which was also in talks to acquire stakes in Future Group, last year bought a tiny portion of Future Group’s business. In January this year, the American e-commerce firm said it had also inked a deal with Future Group to help the Indian firm sell online.

Mukesh Ambani, who controls Reliance Industries (of which Reliance Retail is a subsidiary), has secured about $20 billion from Facebook, Google, and 11 other high-profile investors for his telecom venture Jio Platforms this year.

Now Ambani, who is India’s richest man, has set his eyes on e-commerce. Jio Platforms and Reliance Retail last year announced JioMart. The e-commerce venture, which began test trials in select suburbs of Mumbai late last year, has expanded to more than 200 cities and towns across India.

“With this transaction, we are pleased to provide a home to the renowned formats and brands of Future Group as well as preserve its business ecosystem, which have played an important role in the evolution of modern retail in India. We hope to continue the growth momentum of the retail industry with our unique model of active collaboration with small merchants and kiranas as well as large consumer brands. We are committed to continue providing value to our consumers across the country,” said Isha Ambani, Director at Reliance Retail, in a statement.

This is a developing story. More to follow…

#asia, #ecommerce, #fundings-exits, #india, #mukesh-ambani, #reliance-retail

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India’s Reliance Retail acquires a majority stake in online pharmacy Nedmeds for $83.2M

Reliance Retail has bought a 60% stake in pharma marketplace Netmeds for about $83.2 million, it said today as India’s largest retail chain looks to expand into new categories and compete more closely with American e-commerce group Amazon.

The all-cash deal valued Netmeds, which serves 5.7 million customers in more than 670 cities and towns and online, at about $134 million. Consumers get access to more than 70,000 prescription drugs for chronic and recurring ailments as well as enhanced lifestyle drugs and thousands of non-prescription goods for wellness, health, and personal care through Netmeds.

“This investment is aligned with our commitment to provide digital access for everyone in India. The addition of Netmeds enhances Reliance Retail’s ability to provide good quality and affordable health care products and services, and also broadens its digital commerce proposition to include most daily essential needs of consumers,” said Isha Ambani, Director of Reliance Retail, in a statement.

Reliance Retail, like its sister telecom venture Jio Platforms, is a subsidiary of Reliance Industries, the most valued firm in India. Reliance Industries is run by Mukesh Ambani, Asia’s richest man.

The announcement late Tuesday evening (local time) comes days after Amazon struck a deal with NetMeds, 1mg, PharmEasy and Medlife to sell medicines online in Bangalore. It was the first time Amazon had expanded into this category, it said. The coronavirus pandemic has accelerated the adoption of telemedicine and pharma marketplaces in the country, analysts said.

Online sales of medicine in India, for which New Delhi currently does not have clear regulations, presents yet another major opportunity for Reliance Retail, which has expanded its new e-commerce venture — called JioMart — to more than 200 cities and towns in the recent quarters.

Local media has reported that Reliance is also in talks to acquire online furniture store Urban Ladder, milk delivery startup MilkBasket and Bangalore-based lingerie maker Zivame. TechCrunch reported last week that Reliance Industries was also in talks to acquire the India business of TikTok.

More to follow…

#amazon, #amazon-india, #apps, #asia, #funding, #health, #india, #reliance-retail

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Amazon launches online pharmacy in India

Amazon has launched an online pharmacy in Bangalore, the capital of India’s southern Karnataka state, as the e-commerce group looks to spread its tentacles in more categories in one of its key overseas markets.

The company said on Friday its new service, called Amazon Pharmacy, has started accepting orders for both over-the-counter and prescription-based medicines in Bangalore. (In India, antibiotics and several other drugs can often be purchased from pharmacies without prescriptions.)

Amazon Pharmacy is also selling traditional herbal medicines and some health devices such as glucose meters, nebulisers, and handheld massagers.

“This is particularly relevant in present times as it will help customers meet their essential needs while staying safe at home,” an Amazon spokesperson said in a statement.

Online sales of medicine in India, for which New Delhi currently does not have clear regulations, presents yet another major opportunity for Amazon that has invested more than $6.5 million to date into its India operations and where it competes with Walmart-owned Flipkart.

For Amazon, pharmacy is not a new idea. The company, which has hired several health experts in recent years, acquired online pharmacy startup PillPack for nearly $1 billion in 2018.

Scores of startups such as 1mg, Netmeds, Medlife, and PharmEasy currently sell medicines in India online and deliver to most parts of the country. 1mg, which has raised more than $170 million, today delivers orders in more than a 1,000 cities in the country, for instance.

These startups, as with any e-commerce player, offer enticing discounts to customers on each order to increase their market share. On that front, Amazon says it is also offering up to 20% discount on all orders.

In recent months, Amazon has expanded into a handful of new categories in India. It launched its food delivery service in parts of Bangalore in May and received approval to sell and deliver alcohol in the state of West Bengal a month later.

Last month, the company started to sell auto-insurance in India and said it planned to expand its insurance service to offer coverage on health, flight and cabs in the future.

Its expansion into more categories comes as Flipkart is also entering new spaces including hyperlocal delivery that it piloted in Bangalore late last month.

Both the firms are now facing an emerging challenger: India’s richest man. Mukesh Ambani’s Reliance Retail, the largest retail chain in India, began testing e-commerce venture JioMart late last year.

The service, which is now operational in over 200 cities and towns across India, reported selling over 400,000 orders a day last month, surpassing daily peak figures of grocery delivery startups BigBasket and Grofers.

Local media has reported that Amazon is eyeing a multi-billion dollar stake in Reliance Retail. Ambani’s other venture, telecoms giant Jio Platforms, has raised about $20 billion from Facebook, Google, and 11 other high-profile investors in recent months. Ambani said last month that the company had concluded fundraise for Jio Platforms and is looking forward to “induct global partners and investors in Reliance Retail in the next few quarters.”

#amazon, #amazon-india, #apps, #asia, #ecommerce, #flipkart, #india, #jiomart, #mukesh-ambani, #online-pharmacy, #pharmacy, #reliance-jio, #reliance-retail, #walmart

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