Reliance Industries Limited’s retail unit has acquired majority equity stake in online medical store Netmeds. The deal is worth Rs 620 crore and gives Reliance a 60% stake in the online pharmacy company. The acquisition strengthens the multinational conglomerate’s position in e-pharmacy space and expand its business portfolio.
The deal also allows Mukesh Ambani-led Reliance to compete with Amazon after their foray into e-pharmacy. According to a TOI report, Walmart-owned Flipkart is also looking to enter the e-pharmacy space.
After the deal, founder and CEO of Netmeds Pradeep Dadha tweeted,
Reliance has been looking to enter the e-commerce space since the Covid-19 pandemic and announced its entry with Jiomart. Reliance has been aggressively targeting the online market and expand its presence in the digital ecosystem. Recent reports have suggested Reliance is also planning to acquire online platforms like Urban Ladder, Milkbasket and Zivame.
The lockdown along with the coronavirus pandemic has seen households staying indoors and making online purchases. The recent Amazon Prime Day sale saw businesses doing better compared to the pre-Covid time. The fight for e-commerce supremacy has become interesting since Reliance’s foray into this sector. Earlier, the sector was dominated by the duopoly of Flipkart and Amazon.
Online medicine and healthcare products retailer Pharmeasy has also proposed a merger deal with its rival Medlife, according to a joint filing with anti-trust regulator Competition Commission of India (CCI).
The All India Organisation of Chemists and Druggists had opposed Amazon’s move into the e-pharmacy space. They have written a letter to Jeff Bezos and Indian government officials against online medical stores. It will be interesting to see its effect on the other online medical stores too.
Netmeds is promoted by Dadha Pharma, a Chennai-based company. The Dadha family’s pharmaceutical experience dates back to 1914, when they ventured first into the pharma retailing business and then into drug manufacturing in 1972, Reliance Industries said in a release.