Tata gets Competition Commission approval to acquire 64.3% in BigBasket

Tata Digital can acquire up to 64.3 % of the total share capital of Supermarket Grocery Supplies Private, which owns the online grocer.

The Competition Commission of India (CCI) on Thursday approved Tata Digital’s acquisition of a majority stake in online grocer BigBasket.

Tata Digital can acquire up to 64.3 per cent of the total share capital of Supermarket Grocery Supplies Private Ltd (SGS). SGS can acquire the sole control over Innovative Retail Concepts Private Ltd, which operates BigBaskt’s online retail business.

Tata Digital will now give exit to investors Alibaba, which holds around 29 per cent stake in BigBasket, along with investors Actis LLP (16.3 per cent), and IFC (4.1 per cent). Tata has finalized plans to acquire this stake for about Rs 9,300 crore (about $1.2 billion).

According to a report by RedSeer and BigBasket, India’s e-grocery market is expected to grow from $1.9 billion in 2019 to $3 billion by the end of 2020. At an annual growth rate of 57 per cent, it is expected to touch $18 billion by 2024.

With big names including Tatas, Amazon, Reliance, Walmart-owned Flipkart and Udaan making their presence felt in this space, e-grocery is emerging as one of the most coveted retail segments. As marquee players line up, BigBasket will need serious money to remain a leader in the game, according to experts. 

Supermarket Grocery had reported a consolidated net loss of Rs 611 crore in FY20, a 6.7 per cent rise from Rs 572 crore in the previous year. The company posted a 36 per cent jump in revenue at Rs 3,822 crore in FY20, according to business intelligence platform Tofler.