Mumbai: Mukesh Ambani-led Reliance Retail has agreed to acquire a majority stake of 40.95% stake in India's oldest information search firm Justdial for Rs 3497 crore from promoters VSS Mani and by way of preferential allotment.
"Reliance Retail, Just Dial and VSS Mani & others, today executed definitive agreements which will entail: a) Preferential allotment of 2.12 crore equity shares (equivalent to 25.33% post preferential share capital) at price per share of Rs 1,022.25 b) Acquisition of 1.31 crore equity shares by RRVL from VSS Mani (equivalent to 15.62% post preferential share capital) at a price per share of Rs 1,020.00," said Reliance Retail in a statement.
As per the terms of the deal, shareholders agreement governing certain rights and obligations between the parties Reliance Retail would make a public announcement to the public shareholders of Just Dial to acquire up to 2.17 crore equity shares of Just Dial representing 26.00% under SEBI's takeover regulations. ABP News on Thursday reported about the deal.
Commenting on the deal, Ms. Isha Ambani, Director of RRVL, said, "Reliance is excited to partner with Justdial and Mr. 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 Just Dial as we further expand the business going forward."
VSS Mani shall continue as Managing Director and Chief Executive Officer to lead Just Dial through the next growth phase. The capital infused by RRVL will help drive the growth and expansion of Just Dial into a comprehensive local listing and commerce platform.
Mr. VSS Mani, Founder and CEO at Justdial said, "Nearly 25 years ago, we had a 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 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."
Just Dial would expand discovery on its platform and enhance transactions for millions of products and services. These investments will leverage Just Dial's existing database of 30.4 million listings and its existing consumer traffic of 129.1 million quarterly unique users.
Justdial, which operates on mobile, apps, websites, and a phone hotline with the number 8888888888, reported a profit of Rs 214.19 crore in FY21 on revenues of Rs 675.18 crore.
Analysts believe that Just Dial will be a strategic fit for Reliance's retail arm for the vast database and the listing company's pan-India network, which will be an impetus to the retail giant's digital play.
The transaction is subject to shareholder and other customary closing conditions and approvals.
Ahead of the deal announcement, Reliance Industries (RIL) shares closed up 1.37% at Rs 2111.8, while Just Dail shares closed down 3.04% at Rs 1073.3, valuing the company at Rs 6683.7 crore.