Indian conglomerate Tata Group has reached an agreement to acquire a majority stake in grocery delivery company BigBasket, a source familiar with the matter told TechCrunch.
The software salt giant is buying more than 60% of BigBasket’s shares, valuing the Indian startup at between $ 1.8 billion and $ 2 billion, the source said, requesting anonymity as the deal is still private. BigBasket raised more than $ 750 million prior to the Tata deal.
Indian news network ET Now reported on Tuesday that the two companies were in advanced talks, the signals of which began to emerge in local media two quarters ago. Two co-founders of BigBasket and Tata Group did not respond to a request for comment.
Chinese backer Alibaba and a handful of other investors are getting a near-complete exit from BigBasket as part of the deal with Tata Group, the source said.
The move comes as Mumbai-based Tata Group, which reported revenue of $ 113 billion in 2019 and operates several popular brands such as Jaguar Land Rover and tea maker Tetley, seeks to expand into more consumer businesses and works to develop a super app call. in the second largest Internet market in the world.
Bangalore-based BigBasket, which competes with SoftBank-backed Grofers and Reliance’s JioMart, operates in more than two dozen cities in India and turned profitable months into the coronavirus pandemic as sales soared on the platform.
In a recent note to clients, Bank of America analysts estimated that the online grocery delivery market could be worth $ 12 billion in India by 2023.
“Competition is high in the industry with large verticals like BigBasket / Grofers and horizontals like Amazon / Flipkart trying to turn the disorganized market into an organized one. Until recently, the number one player in the space was BigBasket, with an annualized GMV of $ 1 billion and selling more than 300,000 orders every day. Reliance Industries also launched its hat with the company that launched its JioMart app on May 20 in 200 cities, ”they wrote.