Samara Capital, a private equity firm, and Amazon have reportedly inked a deal to buy More, which is Aditya Birla Retail Ltd.’s (ABRL) food and grocery retail chain. Sources familiar with the matter said that Samara has grabbed a majority stake of 51 percent, while Amazon’s investment arm obtained the remaining 49 percent.
The deal is expected to be valued at around Rs 4,200 crore, the sources indicate, and the transaction is subject to regulatory approvals. It was confirmed that post-acquisition, the business will run as usual and there will be no alterations for the employees of More.
RKN Retail Pvt Ltd, which along with Kanishtha Finance and Investment Pvt Ltd owns Birla’s retail venture, stated in a filing that the company’s board of directors had held a meeting on the 19th of September. At the meeting, it was agreed that RKN’s entire 62.19 percent shareholding in ABRL will be sold to Witzig Advisory Services Pvt Ltd, which is owned and managed by Samara Alternative Investment Fund.
RKN revealed in the filing that the company, together with ABRL and Kanishtha Finance and Investment Private Limited, has signed a share purchase agreement with Witzig for selling their cumulative share of 99.99 percent in ABRL.
The sources added that Amazon will acquire 35 percent in the retail chain from Samara AIF initially, raising it to 49 percent over time. Experts suggest that Samara AIF will be considered a domestically controlled entity according to the law, since it is funded and managed by Indians.
Apparently, this acquisition would assist in fulfilling Amazon’s aspiration in becoming a bigger player in the food and grocery market in India, where it competes with Alibaba-backed BigBasket and Softbank funded Grofers. Amazon, supposedly, has made a commitment to invest up to $500 million so far into the food retail sector in India.