Titan to buy majority stake in jewellery e-tailer Caratlane

Titan Co Ltd, Tata Group's watch and jewellery retailing firm, has struck a deal to buy a majority stake in India's largest jewellery e-tailer Caratlane.com in what marks another offline retail firm snapping up an e-commerce platform in its own vertical.

Titan said on Friday it will buy a majority stake in Carat Lane Trading Pvt Ltd, which operates Caratlane.com. It didn't give the deal value and said the final contours of the transaction are yet to be worked out.

Caratlane, which competes with the likes of Bluestone among others, is backed by Tiger Global. One of the most active venture investors in the country till last year, Tiger Global had pumped in over $50 million in Caratlane in tranches, according to VCCEdge, the data research platform of VCCircle.

It had last invested in the firm in December 2014 at an enterprise value of $117 million (Rs 716 crore then) in what was a Series D round of funding.

This came almost two years after it invested around $10 million in a Series C round. Previously, it had invested in 2011 and 2012.

Founded in 2008, Caratlane deals in gold, silver and diamond jewellery. It was founded by Srinivasa Gopalan, an IT entrepreneur who was the founder and CEO of Lister Technologies, and Mithun Sacheti, scion of Jaipur Gems, which has stores in Mumbai, Chennai and Coimbatore.

Lately, it had been also expanding offline with physical retail outlets.

For the year ended March 31, 2014, Caratlane had generated revenue of Rs 98 crore with a net loss of Rs 30.75 crore. It's latest financials could not be gathered.

Another significant player in the space is Bluestone.com, which is backed by Accel Partners, Kalaari Capital and Saama Capital. Interestingly, former Tata Group chairman Ratan Tata is an investor in Bluestone.

Bluestone, which was under a fifth the size of Caratlane in terms of revenue in FY14, closed the year ended March 31, 2015 with more than three-fold growth in sales to Rs 59.8 crore. Its net loss also doubled to Rs 42.8 crore in the same period.

Offline to online play

This deal marks the second such transaction where an offline retailer is taking control of an online player in its vertical.

Last month, Future Group acquired Rocket Internet-backed online furniture and home furnishings store FabFurnish.com in an all-cash deal that marked the Kishore Biyani-led retail conglomerate's first acquisition in India's growing e-commerce sector. Future Group runs its own offline furniture store under the Home Town brand.

Meanwhile, this deal also adds to a string of such acquisitions by firms associated with industrial houses in the e-commerce space.

Earlier, Mahindras acquire Babyoye.com and Godrej Group's gourmet food retail chain Nature's Basket had acqui-hired EkStop.

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