India’s largest online grocer, Big Basket, is going to be acquired by the Tata Sons Pvt. Ltd at more than $1 billion.
Tata Digital Ltd, a subsidiary of Tata Sons’ has proposed to take up to 64.3% stake in SGS (Supermarket Grocery Supplies Pvt. Ltd), which sells products through business. Bigbasket.com to commercial units. Later, SGS may take full hold of IRC (Innovative Retail Concepts Pvt. Ltd, which sells products to customers through bigbasket.com.
A person familiar with this deal said that this stake will cost Tatas around a billion dollars. “Tata may infuse additional capital into Big basket, which may enhance its effective holding to about 80% or more”. “Tata Sons held a board meeting a little more than a week ago. The deal has been approved by the board and a CCI approval has been sought,” Said the same person.
According to the CCI filing, the latest transaction involves “acquisition by Tata Digital of up to 64.3% of the total share capital of SGS through a combination of primary and secondary acquisitions, in one or more series of steps (transaction 1). Subsequently, through a separate transaction, SGS may acquire sole control over IRC (transaction 2). The proposed transaction will result in the acquisition by TDL of a majority stake of and control over SGS.”
Person cited above also said, “In this deal, most of the large non-promoter investors will take an exit and the founding shareholders will continue to have a stake. The company has proposed to buy a 64.3% stake from existing non-founder, non-promoter investors.”