CCI Approves AZK4’s Stake Acquisition In B2B Unicorn Zetwerk

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SUMMARY

AZK4 LLC will subscribe to and purchase around 2.96% of Zetwerk’s shareholding through a combination of primary and secondary transactions

AZK4 LLC is an investment vehicle managed by US-based private equity investment firm Avenir Management Company

Zetwerk is a manufacturing services provider and caters to businesses in the precision parts, capital goods and consumer goods categories

The Competition Commission of India (CCI) on Friday said it has approved the proposed stake acquisition in B2B contract manufacturing unicorn Zetwerk Manufacturing by AZK4 LLC.

AZK4 LLC will subscribe to and purchase around 2.96% of Zetwerk’s shareholding through a combination of primary and secondary transactions through the proposed transaction, the CCI said.

Commenting on the development, a Zetwerk spokesperson said, “Zetwerk is in the final phase of completing another round of equity investment into the company, which involves existing and new investors. This infusion of funds will allow Zetwerk to accelerate its growth plans, build cutting-edge tools and technologies, expand its global presence, and further strengthen its position as a market leader across various industrial and consumer manufacturing categories.”

AZK4 LLC is an investment vehicle managed by a US-based Avenir Management Company. Avenir Management Company is a private equity investment firm which operates under the brand name Avenir Growth Capital.

Zetwerk is a manufacturing services provider and caters to businesses in the precision parts, capital goods and consumer goods categories. It provides contract manufacturing services on a B2B basis.

“Given that there are no horizontal overlaps or vertical or complementary linkages between the activities of the Parties (including their affiliates), the proposed combination is being notified under the green channel route under Regulation 5A(1) read with Schedule III of the Competition Commission of India,” the CCI said.

Earlier in March, Zetwerk reportedly raised INR 100 Cr in debt funding from the likes of Edelweiss Group, along with one more fund and multiple high net-worth individuals (HNIs).

Founded in 2018 by Amrit Acharya, Srinath Ramakkrushnan, and Vishal Chaudhary, Zetwerk has raised $650 Mn in funding to date. It entered the unicorn club in September 2021after raising $150 Mn in a funding round led by New York-based D1 Capital Partners.

It competes with the likes of InfraMarket.com, Udaan, Moglix and OfBusiness.

In FY22, Zetwerk posted a loss of INR 59.7 Cr, up 45% from INR 41.1 Cr in FY21. Operating revenue rose 5.9X to INR 4,960.5 Cr from INR 835.4 Cr in FY21.