NEW DELHI: Amazon on Wednesday announced that it will acquire Prione Business Services, the joint venture between Infosys founder Narayan Murthy-led Catamaran and Amazon, subject to regulatory approvals. Amazon will hold a 100% stake in Prione post the acquisition.
The e-commerce major has approached the Indian anti-trust body Competition Commission of India (CCI), seeking its approval for the acquisition, just months after Catamaran and Amazon mutually decided to end their joint venture (JV) in August this year.
Amazon and Cataraman in a joint statement on Wednesday said, “The businesses of the joint venture shall continue under the leadership of the current management and on receipt of regulatory approvals, the board of Prione & Cloudtail will take steps to complete the transaction in compliance with applicable laws.”
The decision to end the JV came a few hours after a Supreme Court decision that allowed CCI India to continue its probe against Amazon as well as rival Flipkart for alleged preference shown to select sellers.
Prione is the wholly-owned subsidiary of Cloudtail, which is one of the largest sellers on Amazon India’s marketplace.
Notably in 2018, the government had introduced stricter Indian foreign direct investment (FDI) norms mandating any foreign-owned e-commerce entity do not sell products of their group companies on their platforms. Following the amendments, Catamaran Venture raised its stake in Prione Business Services from 51% to 76% while Amazon reduced its shareholdings to 24%.
Amazon in HC for clarification on ED’s probe
Amazon on Wednesday filed a writ petition in the Delhi High Court challenging the Enforcement Directorate’s (ED) investigations into alleged foreign exchange violations by the company, ahead of its 2019 deal to acquire a 49% stake in Future Coupons, sources said. Amazon has challenged the ED investigation citing that it ‘pertains to transactions that have no foreign exchange element. “In its filing, Amazon said that the ED is expanding the scope of its investigations by seeking privileged and confidential legal advice it received in ordinary course of business since it started marketplace operations and that such requests aren’t related to the probe agency’s investigation into the Future-Amazon deal.