Samara reportedly acquired a majority 51 percent stake in Aditya Birla Retail, while Amazon's investment arm picked up the remaining 49 percent
Private equity firm Samara Capital and US headquartered Amazon have signed an agreement to acquire Aditya Birla Retail Ltd’s (ABRL) food and grocery retail chain More.
''The board of directors of the company, at its meeting held on September 19, 2018, has approved the sale of its entire shareholding in ABRL, constituting 62.19% of the paid up capital of ABRL, to Witzig Advisory Services Private Limited (Witzig) which is owned and controlled by the Samara Alternative Investment Fund'' RKN Retail Pvt Ltd said in a regulatory filing.
"The company has, today, jointly with Kanishtha Finance and Investment Pvt Ltd and ABRL, entered into a share purchase agreement with Witzig, to sell their combined stake aggregating to 99.99% in ABRL," it added.
According to one source privy to the development, the deal is pegged at around Rs 4,200 crore. The person also said that nothing changes for the employees of More and the business will be as usual post-acquisition.
The deal which is expected to have been done with a shell structure in place is going to give Amazon a big push in the grocery space which is heating up in India.
Indian regulations allow foreign retailers to own only 51 percent in multi-brand retail firms which is why Amazon is sticking with a lower stake.
In India, Amazon competes with Softbank-backed Grofers and Alibaba-funded BigBasket in the grocery segment.
The deal happens at a time when both these companies are expected to have revived their merger talks.
Recently, Amazon also re-branded its Amazon Now service to Prime Now.
So far Amazon as made a commitment to invest $500 million for food retail in India.
The deal is subject to regulatory approvals.