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In a move to comply with Indian e-commerce regulations, Amazon India is reportedly divesting its stake in major seller Appario and facilitating its acquisition by Clicktech, another leading seller on the platform.
The Economic Times reported that Appario, currently the largest seller on Amazon India following the closure of Cloudtail, is a wholly-owned subsidiary of Frontier.
The deal involves a two-pronged approach:
Clicktech, a company backed by the Vinod Poddar Group, will acquire Appario's business operations. This move strengthens Clicktech's position in the Indian e-commerce market and allows them to expand their product offerings.
Amazon will fully acquire Frontizo Business
Services, Appario's parent company, from its joint venture partner, the Patni Group.
Following this acquisition, Frontizo will become a wholly-owned subsidiary of Amazon, while Clicktech will take ownership of Appario itself.
This marks the second time Amazon has divested its stake in a major seller to comply with Indian regulations. In 2022, Cloudtail, the then-largest seller with Amazon holding a stake alongside Catamaran Ventures, was delisted and subsequently shut down.
Significance of the Appario Sale
Appario held the distinction of being the last major seller on Amazon India with a direct Amazon stake. Faced with mounting pressure from smaller sellers and regulatory scrutiny, Amazon announced plans to delist Appario from the platform in October 2022.
The Economic Times reported in November of that year that Amazon and the Patni Group were exploring options for Appario Retail to maintain its presence in the marketplace.
The latest development clarifies the situation. "Amazon will acquire Zodiac's (owned by the Patni Group) stake in Frontizo and its subsidiary, Appario Retail Private Limited, subject to regulatory approvals," explained an Amazon spokesperson in a statement.
Cloudtail's Legacy
With Cloudtail's closure, its inventory was divided amongst various companies, including Clicktech and Cocoblu Retail. Several Cloudtail employees and management personnel also transitioned to these new entities, which have emerged as major players on the Amazon India platform.
This shake-up in the Indian e-commerce landscape signifies a significant shift for Amazon as it navigates regulatory requirements and Clicktech emerges as a potential frontrunner.
