Mukesh Ambani’s Reliance Industries’ retail branch has acquired a 96 percent stake in online furniture retailer Urban Ladder. This is for over 182 crores.
Reliance said during a statement that Reliance Retail Ventures Ltd (RRVL), which is a subsidiary of Reliance Industries, has acquired equity shares of Urban Ladder Home Decor Solutions Pvt Ltd. This is for a cash consideration of 182.12 crores. The investment represents 96 percent holding within the equity share capital of Urban Ladder. RRVL also has a further option of acquiring the balance stake, which will take its shareholding to 100 percent of the equity share capital of Urban Ladder.
RRVL has also proposed to make a further investment of up to 75 crores in Urban Ladder. By December 2023 it will be completed.
This acquisition of share will help Reliance in strengthening its presence within the fast-growing e-commerce segment. It will also help in widening the range of consumer products provided by the company as it looks to compete with e-commerce majors like Amazon and Flipkart.
There were no requirements for governmental or regulatory approvals for the investment by RIL.
In August this year, RIL had acquired a majority stake in the digital pharma marketplace Netmeds for around 620 crores.
RIL is on a fundraising spree by selling stakes in RRVL. Earlier this month it had been announced that 9,555 crore investment from the general public Investment Fund of Saudi Arabia, took the entire fundraising within the last two months to 47,265 crores.
Reliance Retail Ltd Is The Fastest Growing Retail Business
Reliance Retail Ltd which is a subsidiary of RRVL operates the fast-growing and largest retail business in India. It witnesses close to 640 million footfalls at its 12,000 stores across the country.
The booming e-commerce market in the country will be worth 86 billion dollars by 2024. The stakes are specifically high for Amazon. The online retail giant believes India may be a big growth market after shutting its online store in China last year.
Reliance Retail’s goal is to galvanize the Indian retail sector through its new e-commerce strategy. It wants to serve millions of customers by empowering micro, small and medium enterprises.
Ashish Goel and Rajiv Srivatsa are the co-founders of Urban Ladder in July 2012.
In 2014, Ratan Tata had also invested in Urban Ladder. Although there was no disclosure of the amount.
In the past, the corporate had also raised funds from risk capital funds like SAIF Partners, Sequoia Capital, Kalaari Capital, and hedge fund Steadview Capital.
Apart from the online presence, the company has a presence in offline channels. It operates a chain of retail stores in several cities across India. Urban Ladder’s audited turnover in 2018-19 was 434 crore and the company’s profit was 49.41 crore.