Tata Group may raise up to $25 bn from Walmart for a super app platform: Reports

Tata Group may raise up to $25 bn from Walmart for a super app platform: Reports
Photo Credit: Reuters
29 Sep, 2020

India's largest conglomerate, the Tata Group, is in discussions with global financial and strategic investors to raise capital to create a super app that will bring its wide range of retail offerings under one umbrella, according to multiple media reports.

US-based retailer Walmart, which owns Benhaluru based e-commerce firm Flipkart, is looking to create a joint venture with Tata Group for the super app platform in which it would own a significant stake, financial daily Mint reported.

The investment would touch $20-25 billion eventually, the report added. The proposed super app will leverage synergies between Tata’s e-commerce business and Flipkart, and will be hosted under a Tata Sons subsidiary.

Walmart has appointed Goldman Sachs to advise on the deal.

The super app is likely to be launched in India in December or January. The platform will gather all of Tata’s consumer businesses including healthcare, food and grocery ordering, insurance and financial services, fashion, lifestyle, electronics, over-the-top services, education and bill payments under one platform, the report said.

Tata Sons’ chairman and former CEO of Tata Consultancy Services Natarajan Chandrasekaran is heading the group’s digitization drive while Tata Digital’s head Pratik Pal is leading the development of the super app platform, a Bloomberg report said.

Among the potential investors, the Tata Group is also talking to global technology companies to raise capital, which will also help the company pare its debt, the report added.

The Tata Group runs a number of ecommerce platforms including Tata Cliq, online grocery store StarQuik, OTT aggregator platform Tata Sky, and omnichannel electronics platform Croma. Many of its other retail brands including Tanishq, Titan, and Taj Hotels are present online as well.

With the all-in-one e-commerce app, the coffee-to-cars conglomerate is looking to up its game against Reliance Industries’ Jio Platforms and Amazon, the two powerhouses strengthening their presence in India.

Mukesh Ambani-owned Reliance Industries (RIL) has raised close to $20 billion from several private equity firms and strategic investors such as Facebook, Google, Qualcomm, and Intel to build its digital business Jio Platforms.

US-based retail giant Amazon, which has been strengthening its India play organically over the years, recently ventured into the online pharmacy and food delivery services in the country.