Amazon.com is set to buy a 5 percent stake in Indian retailer Shoppers Stop, valued at $27.6 million (1.79 billion-rupee), as the US company steps up efforts to gain ground in the fast-growing consumer market.
Shoppers Stop’s board approved the issuance of 4.4 million shares to a unit of Amazon for 407.78 rupees ($6.28) each, the Mumbai-based company said in an emailed statement late Saturday. As part of the deal, Amazon experience centres - which let customers test out the products available online - will be set up across Shoppers Stop’s network of 80 bricks-and-mortar stores in India.
CEO Jeff Bezos has allocated $5 billion toward Amazon’s expansion in India as it seeks to secure an advantage over local rivals in the South Asian nation. The e-commerce giant has a lot riding in the country after its washout in China, where the dominance of Alibaba Group and other domestic players made Amazon’s entry difficult.
Shoppers Stop, which sells cosmetics to clothing and home appliances at its outlets, will have an exclusive flagship store on Amazon’s Indian site where it will retail its entire portfolio of more than 400 brands, the company said. Shares of Shoppers Stop have gained 45 percent this year and closed at 418.1 rupees on Friday in Mumbai.
The deal will be Amazon’s first investment in a publicly traded retailer in India.For all the latest retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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