Reliance Retail Ventures Ltd (RRVL), the retail arm of Reliance Industries Ltd (RIL), on Friday said it has acquired a controlling stake in Justdial Ltd for a total consideration of Rs 3,497 crore.
After the acquisition, Reliance Retail Ventures Ltd will hold 40.95 percent and would make an open offer to acquire up to 26.0 percent in accordance with takeover regulations.
VSS Mani will continue to lead Justdial as managing director and chief executive officer, the press release from Reliance Retail Ventures Ltd said.
The Justdial board has approved the preferential allotment of 2.12 crore equity shares (equivalent to 25.33 percent post preferential share capital) at price per share of Rs 1,022.25 to Reliance Retail Ventures Ltd.
Also, Reliance Retail Ventures Ltd has acquired 1.31 crore equity shares from VSS Mani (equivalent to 15.62 percent post preferential share capital) at a price per share of Rs 1,020.00.
The capital infused by RRVL will help drive the growth and expansion of Justdial into a comprehensive local listing and commerce platform. Justdial would expand discovery on its platform and enhance transactions for millions of products and services. These investments will leverage Justdial's existing database of 30.4 million listings and its existing consumer traffic of 129.1 million quarterly unique users (as of March 31, 2021).
Speaking on this transaction, Isha Ambani, director of RRVL, said, "Reliance is excited to partner with Justdial and VSS Mani, a first-generation entrepreneur, who has created a strong business through his business acumen and perseverance. The investment in Just Dial underlines our commitment to new commerce by further boosting the digital ecosystem for millions of our partner merchants, micro, small and medium enterprises. We look forward to working with the highly experienced management team of Justdial as we further expand the business going forward.
VSS Mani, founder, and CEO at Justdial said, "Nearly 25 years ago, we had the vision to build a connected single platform dedicated to providing fast, free, reliable and comprehensive information to our users and connect buyers to sellers. Our vision has evolved to not only provide search and discovery but drive commerce across merchants through our B2B platform and enable the further consumer to merchant commerce given our platform engagement. Our strategic partnership with Reliance enables us to realize this vision and transform the business going forward."
The transaction is subject to shareholder and other customary closing conditions and approvals.
Morgan Stanley acted as a financial advisor, JM Financial as the manager to the open offer, Shardul Amarchand Mangaldas and Khaitan & Co as legal advisors, and Deloitte as accounting and tax advisors to RRVL.
Goldman Sachs acted as an exclusive financial advisor, Cyril Amarchand Mangaldas as legal advisor, and Ernst & Young provided tax advisory and diligence services to Just Dial and its promoters.
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First Published: IST