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Amazon-India seeks to acquire Cloudtail-parent Prione from Narayana Murthy’s Catamaran

Amazon and NR Narayan Murthy’s Catamaran entered into a joint venture in 2014, forming SMB-enabler Prione Business Services. In August, Amazon and Catamaran had announced that they would not continue their joint venture beyond May 2022, and now Amazon is seeking regulatory approvals from CCI to wholly own Prione.

The companies, in a joint statement, said, “Prione…will be acquired by Amazon subject to requisite regulatory approvals. On August 09, 2021, the partners [Catamaran and Amazon] had announced their decision to not continue the JV beyond the end of its current term of May 2022. Amazon will acquire Catamaran’s shareholding in Prione in compliance with applicable laws including all assets and liabilities.”

The businesses of the joint venture will continue under the leadership of the current management. Further, post-regulatory approvals, the board of Prione (and its 100% subsidiary Cloudtail) will take steps to complete the transaction in compliance with applicable laws.

Surprisingly, Amazon is the smaller stakeholder here, owning only 24% of Prione. While it earlier owned a 49% stake in the company, it diluted the shareholding subject to the draft ecommerce rules. In 2018, the government introduced stricter norms for ecommerce marketplaces with foreign investments. It mandated that they do not sell products of their group companies on their platforms, and thus Prione Business Services, which owns one of the biggest sellers on the platform — Cloudtail, was restructured.

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