CAIT moves CCI to block Amazon deal to acquire Cloudtail
Amazon currently has a 24 percent stake in Cloudtail, while Catamaran Ventures, NR Narayana Murthy’s private investment firm, has a 76 percent stake in it. Additionally, Amazon India’s head Amit Agarwal is one of the board members of Cloudtail.
January 14, 2022 / 07:13 PM IST
The Confederation of All India Traders (CAIT) on January 14 filed a petition before the Competition Commission of India (CCI) to block e-commerce giant Amazon’s deal to acquire 100 percent shareholding in online retail firm Cloudtail.
It said: “CAIT has today filed a petition before the Competition Commission of India seeking to block the transaction which has been entered into by Amazon where they will acquire 100 percent shareholding in Cloudtail.”
CAIT further said it has provided evidence to the watchdog to prove that Amazon’s acquisition of Cloudtail may hurt its reputation as one that charges less commission.
A statement released by the traders’ body which has locked horns with Amazon on several occasions in the recent past, read: “The petition provides evidence to show Cloudtail charges less fees/ commission and is a preferential seller on the platform, and with its 100 percent acquisition, Amazon will cause an adverse effect on the market.”
It added: “The proposed deal raises some concerns from the viewpoint of competition law… This transaction is not only in violation of competition law but is also a violation of FDI norms.”
Notably, Amazon currently has a 24 percent stake in Cloudtail, while Catamaran Ventures, NR Narayana Murthy’s private investment firm, has a 76 percent stake in it. Additionally, Amazon India’s head Amit Agarwal is one of the board members of Cloudtail.
After both stakeholders announced that Cloudtail India will cease operations from May 2022, Amazon sought CCI’s approval to acquire the 76 percent stake that was held by Catamaran Ventures.
"Amazon will acquire Catamaran’s shareholding in Prione in compliance with applicable laws including all assets and liabilities," the two companies said in a joint statement on December 22. Prione's wholly-owned subsidiary Cloudtail India is one of Amazon's largest sellers in the country.(With PTI inputs)