Reliance Retail to take controlling stake in Just Dial for Rs3,497 cr

Reliance Retail Ventures Ltd (RRVL) will acquire a majority stake in local search engine platform Just Dial for a total consideration of Rs3,497 crore. RRVL on Friday signed agreements with Just Dial and its promoters to acquire up to 40.95 per cent equity stake in the latter. 

RRVL would also make an open offer to public shareholders of Just Dial to acquire another 26 per cent of its equity shares in accordance with the Sebi Takeover Regultions.
RRVL, Just Dial Limited and VSS Mani & others, on Friday executed definitive agreements which will entail preferential allotment of 21.2 million equity shares (equivalent to 25.33 per cent post preferential share capital) of Just Dial at price of Rs1,022.25 per share.
The agreements include acquisition of 13.1 million equity shares by RRVL from VSS Mani (equivalent to 15.62 per cent post preferential share capital) at a price of Rs1,020.00 per share.
They also entered into a shareholders agreement governing certain inter se rights and obligations between the parties.
RRVL would make an announcement to the public shareholders of Just Dial for acquiring up to 21.7 million equity shares of Just Dial, representing 26 per cent of its total equity, in accordance with Sebi Takeover Regulations.
RRVL said VSS Mani will continue as managing director and chief executive officer to lead Just Dial through the next phase of growth.
With the fresh capital infused by RRVL, Just Dial is expected to grow and expand into a comprehensive local listing and commerce platform. 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 around 30.4 million listings and its existing consumer traffic of about 129.1 million quarterly unique users (as of 31 Mar 2021).
“Reliance is excited to partner with Justdial and 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,” Isha Ambani, director of RRVL, 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 realise this vision and transform the business going forward,” VSS Mani, founder and CEO of Justdial, said. 
Reliance Retail said the transaction is subject to shareholder and other customary closing conditions and approvals.
Morgan Stanley acted as financial advisor, JM Financial as manager to the open offer, Shardul Amarchand Mangaldas and Khaitan and Co as legal advisors and Deloitte as accounting and tax advisors to RRVL.
Goldman Sachs acted as exclusive financial advisor, Cyril Amarchand Mangaldas as legal advisor and Ernst & Young as tax advisory and diligence services provider to Just Dial and its promoters.
Reliance Retail is the largest and the most profitable retailer in India with the widest reach. It has been listed among the fastest growing retailers in the world in the Deloitte's Global Powers of Retailing 2021 index. It is ranked 53rd in the list of Top Global Retailers and is the only Indian Retailer to feature in the Top 100.
Just Dial is India's leading local search engine platform which provides search related services to users across India through multiple platforms such as website, apps, over the telephone and text. Just Dial had zbout 30.4 million listings and 129.1 million quarterly unique users across web, mobile, App and voice platforms as of 31 March 2021. The company has recently launched its B2B marketplace platform, JD Mart, which is aimed at enabling manufacturers, distributors, wholesalers, retailers to become internet ready in the post-pandemic era. 
The platform offers digital product catalogues to businesses and aims at digitalising India’s businesses, especially MSMEs, across categories.