Amazon, Samara Capital buy India’s retail chain More
In this article (5)
Samara Capital, a private equity company, has teamed with Amazon to buy Indian grocery retailer More from Aditya Birla Retail.
While the value of the deal has not been disclosed, it is reported a person close to the transaction putting it at around ₹4,200 crore (US$584 million).
It is believed Amazon’s stake in the business will be capped at 49 per cent to comply with Indian foreign investment regulations. The balance will be held by Samara Capital, which is an Indian entity founded by former Citigroup executives.
Amazon has already committed US$500 million to build its food retailing business in India, where it sees massive opportunity for growth.
Analysts say that by investing in More, Amazon can build both online and offline food retailing operations simultaneously and find ways to marry the two. But it faces intense competition from Walmart which spent $16 billion acquiring Flipkart in a deal completed last month.
More operates more than 500 supermarkets and 20 hypermarkets, ranking it fourth among Indian grocery retailers.
Questions & Answers
Q.What is the estimated value of the deal for More, and who provided this information?
What is the estimated value of the deal for More, and who provided this information?
A person close to the transaction reported the deal's value to be around ₹4,200 crore, which is approximately US$584 million. The article does not disclose the official value.
Q.How will the ownership of More be structured between Amazon and Samara Capital?
How will the ownership of More be structured between Amazon and Samara Capital?
Amazon's stake in the business will be capped at 49 per cent to comply with Indian foreign investment regulations. Samara Capital, an Indian entity, will hold the remaining balance.
Q.What strategic advantage does Amazon gain by investing in More?
What strategic advantage does Amazon gain by investing in More?
Analysts suggest that by investing in More, Amazon can simultaneously build both online and offline food retailing operations. This allows them to integrate the two facets of the business in India.
Q.How large is More's current retail footprint in India?
How large is More's current retail footprint in India?
More operates over 500 supermarkets and 20 hypermarkets across India. This extensive network positions it as the fourth-largest Indian grocery retailer.
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