Amazon India has initiated formal negotiations with Kishore Biyani-owned Future Group to acquire 12 to 15 per cent stake in India’s leading retailer with an investment of about US $ 600 to US $ 700 million. Both the companies have signed a term sheet to take this move further, a leading media house reported.
As per the data available, the two brands have been in talks since January this year and if the deal between the physical retail giant and e-commerce giant it will be a mixture of cash and stock.
Notably, this deal is important for Amazon India, as its arch-rival in India, Flipkart sold 77 per cent of its shares to the US-based retail behemoth Walmart in a world record US $ 16 billion deal, which recently got the nod from the country’s authorities.
It is important to add here that, recently Kishore Biyani held meetings with Amazon and Walmart for the sale of a minority stake in the Future Group.
Future Group’s brick-and-mortar wide presence could be the answer for Amazon to tackle all the Foreign Direct Investment (FDI) regulations in India and compete with Walmart’s Flipkart in the country.
The Future Group operates lifestyle and fashion stores like Big Bazaar, Food Bazaar, Brand Factory, Central and Pantaloons. The company further plans to open 1,000 small stores over the next 15 months. It currently employs over 60,000 people and operates in more than 250 cities in the country.
