Developments at Tata Digital; ride-hailing firms optimistic
Also in this letter:
- Ride-hailing firms believe the worst is behind them
- boAt eyes IPO in 2022, plans to raise $400-500 million
Microsoft president predicts ‘era of tech regulation’
Tata Digital roundup: reward for BigBasket founders; terms of 1mg deal
This is Digbijay. Today, we are reporting on some new and significant developments related to the founders of BigBasket, a new board member who has joined the e-grocer, previously unknown terms of the Tata-1mg deal, and what all of this means for the Tata Group.
Tata Digital has been busy acquiring consumer internet companies such as BigBasket and 1mg, besides snagging a minority investment in Mukesh Bansal’s Cultfit, earlier known as Curefit. We have followed all the developments at the Mumbai conglomerate as it prepares to go big on its digital businesses.
First, we take a look at what’s happening at BigBasket — Tata Digital’s biggest purchase so far.
New management stock options: Hari Menon, Vipul Parekh and VS Sudhakar, the founders of BigBasket, have been allotted new ‘management stock options’ (
Retain, attract and motivate: These ‘rewards’ have been given to the founders based on their past performance and future potential. This is important to ‘retain, attract and motivate’ the eligible employees, a committee approving the stock options noted.
Why it matters: While it is common for startups to offer employee stock options to senior staff, the fact that founders of BigBasket have been granted Msops indicates that the Tata group wants them to continue leading operations and grow the business. BigBasket was last valued at $2 billion after the acquisition and cash infusion from the Tatas, and the new grants could be valued higher as the company’s valuation grows before its public market debut.
The online grocery retailer may go for an IPO in the next 1-2 years, we reported earlier.
Mukesh Bansal on board: Mukesh Bansal has joined the board of BigBasket. This was expected as he is the president of Tata Digital and works closely with its top brass as well as group companies like 1mg and BigBasket. Bansal also has a seat on Tata 1mg Technologies, which houses the 1mg platform.
Small cheque for BigBasket: UK’s CDC group, an existing investor in BigBasket, has put almost Rs 85 crore more in SGS.
Management lock-in for 1mg founders: Meanwhile at 1mg, Prashant Tandon and Gaurav Agarwal have a lock-in period of five years and three months. They will also have the right to remain as directors based on certain terms even if they are not on the company’s rolls. They can also sell a small number of shares during the lock-in period. Tandon can sell up to 5,577 while Agarwal can sell up to 3,713.
What about the Tatas? Here are the rights that matter.
1. Tata Digital or its affiliates (Tata Group) will have the right of first offer if any of the investors of 1mg want to sell or transfer their stake in the e-pharmacy to a third party. This will be valid as long as Tata Digital and its affiliates continue to hold a minimum of 26%.
2. No shareholder of 1mg can transfer shares to a ‘restricted person’, which includes a ‘competing platform’ as well affiliates of Tata Digital, including any immediate family members.
3. 1mg’s financial shareholders can ask for the company to go for an IPO after about five years, but Tata Digital will be under no obligation to sell shares in the IPO.
Typically, in an IPO, a company can choose to raise capital by issuing fresh shares, and existing investors can sell a part or their entire holding in the company.
Before we move on, here are some of our stories on Tata Digital you won’t want to miss.
Ride-hailing firms see light at the end of the tunnel
Ride-hailing companies, hit hard by the pandemic, are hopeful that with schools and offices now reopening in many places, the worst is now behind them.
Two days ago,
Ola’s rivals are optimistic, too, with
Cab drivers who had left the cities are also returning, industry insiders told us.
Companies are getting their drivers vaccinated.
Company tie-ups: Uber is also tying up with companies to provide rides for their employees when they return to work.
This segment has been a stronghold of Meru, which recently added about 300 electric vehicles to its fleet and is also planning more such tie-ups with companies. It already transports employees of Kotak Mahindra, Barclays and Tata Consultancy Services.
Domino effect: Collections from this segment are increasing, and so are usage levels, say experts. “We see demand and quality collections improving. Soon we will also see buying (of cars) taking place from this segment as cities like Hyderabad and Bengaluru open up offices,” said Ramesh Iyer, managing director at Mahindra Finance.
Tweet of the day
boAt eyes IPO in 2022, plans to raise $400-500 million
Consumer electronics brand boAt Lifestyle plans to raise about $400-500 million through an IPO next year, sources told us. It plans to file its draft red herring prospectus (DRHP) in a couple of months, they added. The firm is likely to be valued in the range of $1.5 billion for its IPO. Details of the primary and secondary share sale are not yet known.
US private equity fund Warburg Pincus is the largest investor in boAt, with a stake of close to 30%. Other investors include Qualcomm Ventures and Fireside Ventures, which together own less than 5%.
The startup had raised $100 million from Warburg Pincus early this year. Qualcomm Ventures invested Rs 50 crore in April at a valuation of Rs 2,200 crore.
ETtech Done Deals
■ HomeLane has raised $50 million in a Series E funding round led by IIFL AMC’s Late Stage Tech Fund, Oman India Joint Investment Fund and Stride Ventures. The fresh capital will help the home interiors firm accelerate growth to achieve its revenue target of Rs 2,500 crore by FY24.
■ Headout, an online experiences marketplace for travellers, has secured $12 million in Series B financing round led by Glade Brook Capital. The round also saw participation from existing investors Version One Ventures, Nexus Venture Partners, FJ Labs, 500 Startups, Haystack and Ludlow Ventures and new investors Espresso Capital and Practical VC.
■ Sea Ltd., known for its Shopee ecommerce platform that’s planning an India foray, is looking to raise $6.3 billion in a share and convertible bond sale in Southeast Asia’s largest-ever capital raising.
■ Edtech startup Lido Learning will raise about Rs 41 crore from angel investor Ronnie Screwvala and ZNL Growth Fund Scheme 1. Lido Learning passed a special resolution to approve the allotment of 1,41,493 Series Seed 2 preference shares at an issue price of Rs 2,880 per share to raise Rs 40.75 crore, regulatory filings showed.
■ Biotech startup immunitoAI has raised $1 million in a seed funding round led by pi Ventures, with participation from existing investor Entrepreneur First. The capital will be used for product development and striking industry partnerships.
■ Ethnic apparel manufacturer Suumaya Industries has picked up a minority stake in Nysaa Retail, which runs the value retail chain 1-India Family Mart, for about Rs 5 crore, according to people familiar with the deal.
This decade will be an era of regulation, says Microsoft president
Microsoft president Brad Smith (Picture: Microsoft)
Technology companies across the world will see an era of regulation by governments this decade, Microsoft president Brad Smith said during a roundtable with journalists from across Asia.
Quote: “We need to adapt, address the market needs (and) we need to respond to the government’s concerns, and you see that in the public cloud region that we’ve set up for India, you see that in our conversations with the government,” Smith said.
Smith, who leads Microsoft’s engagement with governments globally as head of its legal and corporate affairs, said companies should expect regulations as inevitable and as having “an important role to play” in their business. “This is a decade that will bring regulation to technology, much like the 1930s did for financial services (industry) around the world.”
Oyo, Microsoft tie up for next-gen hotel tech
SoftBank-backed hospitality startup Oyo has struck a multi-year alliance with Microsoft Corp. to co-develop “next-generation” travel and hospitality products. Oyo will adopt Microsoft’s Azure cloud platform as a “key enabler” to drive cloud-based innovations for owners of small and medium hotels and home storefronts.
The partnership with Microsoft will accelerate the deployment of Oyo’s products, allowing it to create more impact through an integrated tech ecosystem available on the cloud, the company said.
Besides co-innovating, Oyo will also begin to shift existing workloads to Microsoft Azure, and adopt the Microsoft 365 suite for better collaboration and productivity. It will also switch to Github Enterprise to accelerate tech development.
Microsoft has also made a strategic equity investment in Oyo, we reported on July 30.
Other Top Stories We Are Covering
Infosys launches digital commerce platform Equinox: Infosys will look to capitalise on increased demand from large enterprises to deliver Amazon-like digital commerce and omnichannel experiences to their customers through its new platform Equinox.
Former Swiggy COO Vivek Sunder joins Cuemath as CEO: Vivek Sunder, the former chief operating officer (COO) of Swiggy, has joined online math learning platform Cuemath as its CEO, according to a statement by the edtech firm.
Byju’s puts IPO plans into overdrive: India’s most valuable startup Byju’s is in talks to raise $400-600 million and then accelerate plans for an initial public offering (IPO) next year, Bloomberg reported Thursday, citing people familiar with the matter.
TCS wins 10-year contract from Transport for London: Tata Consultancy Services has won a 10-year contract from Transport for London to design, implement and operate a cloud-based smart mobility system for administration of London’s 115,000 taxis and private hire vehicles.
Global Picks We Are Reading
- Google’s voice assistant under new EU antitrust investigation: Report (Reuters)
- Tencent leads $60 billion loss as game crackdown fears grow (Bloomberg)
- Facebook unveils its first smart glasses (Reuters)
( News Source :Except for the headline, this story has not been edited by Rashtra News staff and is published from a economictimes.indiatimes.com feed.)
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