New Delhi: India’s Competition Commission has approved Tatas’ proposal to acquire a 64.3 percent stake in BigBasket, an agreement that will give the diversified group a strong foothold in the fast-growing online grocery market. Under the transaction, Tata Digital Ltd (TDL) will purchase up to 64.3 percent of the total share capital of Supermarket Grocery Supplies Pvt Ltd (SGS), as well as SGS’s sole control of Innovative Retail Concepts Pvt Ltd.
SGS is engaged in B2B (business-to-business) sales through the portal business.bigbasket.com. Innovative Retail Concepts Pvt Ltd (IRC) is engaged in B2C (business-to-consumer) sales via www.bigbasket.com and related mobile applications.
TDL is a wholly owned subsidiary of Tata Sons Pvt Ltd and provides technology services related to identity and access management, loyalty programs, offers and payments. An official statement on Thursday said the Competition Commission of India (CCI) had approved the proposed agreement that the Tata group acquire up to 64.3 per cent in Bigbasket.
The transaction involves TDL buying 64.3 percent of SGS’s total share capital (on a fully diluted basis) through a combination of primary and secondary acquisitions, in one or more steps. This is the first transaction. “It is stated that SGS can then, through a separate transaction, only acquire control of Innovative Retail Concepts Pvt Ltd (IRC) (transaction 2). Transaction 1 and Transaction 2 are collectively called the proposed combination.
“The proposed combination will result in the acquisition by TDL of majority interest in and control over SGS,” the report states. BigBasket was founded in 2011 and operates in 25 Indian cities. It competes with Grofers as well as Amazon India and Flipkart. Approval beyond a certain threshold requires CCI approval.
Source: Telangana Today