US e-commerce major Amazon is reportedly set to buy 9.5 percent stake in Kishore Biyani-led Future Group's arm Future Retail for Rs 2,500 crore, a media report said.
According to The Economic Times, Amazon will buy the stake through foreign portfolio route (FPI) and the deal will be announced on 14 November. The deal will give the US e-commerce giant access to nearly a third of India’s organised food and grocery market through the Big Bazaar and Nilgiris supermarket chains and other outlets owned by Future Group.
In August this year, it was reported that Amazon had begun formal negotiations with Future Group to invest around $600-700 million for a 12 to 15 percent stake in the retail major.
Other international names of repute were also eyeing the Indian retail market. Google was looking to join forces with Alibaba-backed Paytm Mall to invest Rs 3,500 crore to Rs 4,000 crore ($499.36 million - $570.69 million) in Future Retail, The Economic Times reported, citing people familiar with the matter. Alibaba was in talks with big Indian companies, including Future Retail, to boost its retailing plans in India.
In June, PremjiInvest, the investment arm of Wipro chairman Azim Premji, picked a six percent stake in Future Retail from the Bharti Group for about Rs 600 crore.
Amazon, on its part, has also been aggressively investing in the Indian market across its e-commerce, payment and logistics operations. It had committed $5 billion to the Indian operations and a large part of that has already been pumped in.
Amazon and homegrown Indian rival Flipkart, owned by Walmart, kicked off competing sales events last month, jostling to grab shoppers in India's October-December festive season when households make most big-ticket purchases.
Amazon and Flipkart are locked in a battle to dominate an Indian e-commerce market tipped, within a decade, to be worth $200 billion annually, according to Morgan Stanley.
Amazon, which already has over 100 million registered users in India, is making a deeper push in the country's small towns and cities in a bid to attract another 100 million customers by investing in infrastructure and partnering with local players for quicker deliveries.
Its Prime loyalty programme, which offers free delivery, early access to deals during sales and free music and video streaming, has helped Amazon win tens of millions of clients, making India its fastest-growing Prime market globally.
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Updated Date: Nov 05, 2018 13:10:16 IST