The Tata group is acquiring online grocer BigBasket as it creates a super-app that will offer a wide range of products under one roof.
Tata Digital (TDL), a subsidiary of Tata Sons, has filed an application with the Competition Commission of India (CCI) to acquire a 64.3 per cent stake in BigBasket.
In its filing, the Tata group said TDL is engaged in the business of providing technology services related to identity & access management, loyalty programmes, offers and payments.
The proposed transaction involves an acquisition by TDL of up to 64.3 per cent of the total share capital of Supermarket Grocery Supplies (SGS) through a combination of primary and secondary (when an existing shareholder sells shares) buyouts. Subsequently, through a separate transaction, SGS may acquire sole control over Innovative Retail Concepts Pvt Ltd (IRC). Through the deal, TDL will gain a majority stake of and control over SGS.
SGS is engaged in online B2B (business to business) sales of various products in India while IRC is engaged in online B2C (business to consumer) sales of various products in India and operates the BigBasket website.
It further pointed out that the proposed transaction will not lead to any change in the competitive landscape or cause any appreciable adverse effect on competition in India, irrespective of the manner in which the `relevant markets’ are defined.
While the deal has been talked about since last year, it may see the exit of Alibaba and some of the other investors from BigBasket. Earlier reports had put the valuation at around Rs 14,500 crore.
The entry of the Tata group could further increase competition in India’s online grocery segment now dotted by players like Flipkart, Amazon’s Fresh and Reliance Retail among others. The Tata group is set to broaden its e-commcerce presence in the days ahead.
