The Tata Group has signed a deal valued at INR 1,200 Crore with 1MG to purchase 65% stake and become the majority stakeholder in the e-pharmacy startup.
The 1MG co-founders Gaurav Agarwal, and Prashant Tandon will stay at 1MG and head the operations division.
1MG had broken away from Healthkart back in 2015. It has raised over $200M thus far across several rounds of funding, from well-known investors like IFC, Sequoia, and Omidyar.
This deal assumes significance for various reasons. for one, it is the second-largest deal of the Tata’s thus far. They have recently acquired a 64% stake in BigBasket with a $1.2B deal. This will also make Tata’s the second major player to buy an e pharmacy after Reliance, which bought a 60% stake in Netmeds. They will be competing with RIL and Amazon in a neck-to-neck battle to assume supremacy in the online medicine space.
1MG and BigBasket are set to back Tatas ambitions for a “superapp”, which is being built under Tata Digital, and the plan is to bring all services and consumer products on one platform including grocery, food, consumer durables, financial services, jewelry, etc. It will also leverage the strength of existing companies like Voltas, Trent, Taj Hotels, Titan, etc.
Categories: Corporate M&A