Amazon, Samara Capital To Acquire Birla’s Retail Chain ‘More’

Amazon and Samara Capital are ready to get the Aditya Birla group’s food and grocery retail chain, two officials said, even the investment bank Goldman Sachs has come out of the consortium.

Aditya Birla Retail Limited Kumar Mangalam Birla (ABRL) at an enterprise value of 4,100-4,200 crores will be acquired by Samara Capital-Amazon Consortium.

Executives said on condition of anonymity that the deal is likely to be completed in the next 10 days, possibly as early as this week.

The acquisition will effectively wipe out the entire debt in ABRL’s book, which stood at about Rs 4,000 crore as of March 2018, they told ET. The deal will be through an existing facility management back-end firm.

The executives said Samara Capital will acquire 51% stake in that firm while Amazon will hold the balance 49% through its investment arm.

One of the executives said, “Since the back-end company where Samara and Amazon are investing has no restriction on FDI, there is no problem,”. That is, once the deal is done ABRL need not take approvals from individual state governments to operate More stores, the person said.

Till late August, Samara Capital – which had signed an “exclusivity” agreement with ABRL in June – was in negotiations with both Amazon and Goldman Sachs to form a consortium to acquire ABRL.

With the More chain in its bag, if Amazon manages to clinch these two deals as well, it will have a stake in more than 1,700 stores and a mine of data to further its business in India as it seeks to compete effectively with Walmart-Flipkart and Reliance Retail.

Rival Walmart already owns and operates a chain of cash-and-carry stores in India apart from its recent takeover of Flipkart.

Chinese online retailer Alibaba, who has made huge investments in payments and retail locations through Paytm and Bigbasket, is looking for local retail partners in top domestic groups like Reliance and Tata.

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