Amazon NV Holdings, the investment arm of Amazon.com, has filed an application with the Competition Commission of India (CCI) to acquire 5% minority, non-controlling stake in departmental store chain Shoppers Stop.
Incidentally, through its investment in Shoppers Stop, will get Amazon a minor stake in Future Retail. The retail arm of Future Group acquired Hypercity from Shoppers Stop in October this year, as part of a $101.5 Mn (INR 655 Cr) cash-and-stock deal.
The development comes less than three months after the Shoppers Stop board approved the proposal to allot equity shares to Amazon, in exchange for an investment of $27.7 Mn (INR 179.2 Cr). At the time, it was reported that the global ecommerce behemoth would be buying a total of 4.4 Mn shares in Shoppers Stop at $6.3 (INR 407.78) apiece.
Why Amazon Is Keen On Acquiring A Minority Stake In Shoppers Stop
As part of the deal, Shoppers Stop has also signed an exclusivity agreement with Amazon Seller Services. According to a report by Livemint, more than 400 of Shoppers Stop’s private labels and brands will soon be sold on a dedicated microsite with Amazon.in.
Commenting on the development, Shoppers Stop CEO and MD Govind Shrikhande said back in September, “We will have the same discounts on Amazon as we carry in our stores.”
According to the terms of the deal, the two companies will be conducting “joint marketing” initiatives in the coming months. On the one hand, Amazon’s experience centres will be created across the network of Shoppers Stop stores to bring the touch and feel aspect to the Amazon.in assortment.