The online food delivery sector Zomato initiated a proposal to buy 9.3 per cent shares in a digital grocery shopping company Grofers India and their proposal seems to get the acceptance of the competition commission. Initially, Zomato was said to have a stake of $100 million in Grofers India, which pertains to have involvement only in the online grocery sector.
9.3 per cent stakes of Grofers India Pvt Ltd and Hands-on Trades Pvt Ltd (HoT) to be attained by Zoamata ass per recent listing. The legit owner of Grofers India and HoT is Grofers International Pte.
In a tweet on Friday, the Competition Commission of India (CCI) said it has cleared the “proposed acquisition by Zomato of approximately 9.3 per cent stake in Grofers India and Hands-on Trades”.
HoT is into the matter of B2B wholesale exchanging with outside traders, contract assembling of food items, staples and different merchandise with the end goal of a forward deal on a wholesale premise, and giving warehousing administrations, including storing food items and staple products to outsider vendors.
As per the notice enlisted by the regulator, the investment will involve Zomato to accommodate 9.3 % shares in both each of Grofers India and HoT with certain benefits. The notice further mentioned certain segments of both parties where they intersect each other.
Such business sectors incorporate the supply of food, family things, general product, individual cleanliness items, foods grown from the ground in India just as the smaller portion of B2B supply of food, family essentials, general product, individual cleanliness items, products of the soil in the country.
Another potential significant market is the one for resources given by online sectors that offer food, family necessities, general product, cleanliness items, products homegrown in India.
“The parties submit that the potential relevant markets/ segments identified above are highly fragmented with the presence of multiple players, including several unorganised players, who will continue to impose significant competitive constraints. The proposed transaction will have no impact on the competitive landscape in any potential relevant market in India, in any manner,” the notice said.
“It (grocery) is a large opportunity. Online grocery is nascent right now but is growing rapidly not just in India but across the world… We are actively experimenting in that space and recently invested $100 million for a minority stake in Grofers, with the idea of getting more exposure to that space and building our strategies and plan around that business,” Zomato CFO Akshant Goyal said in July.