Reliance Retail Acquires 60% Stake In Online Pharmacy Netmeds for $83 Million

Retail has finally entered the online medicine delivery space with the acquisition of Netmeds. The former has acquired a 60% equity stake in e-pharmacy startup Netmeds for INR 620 Cr ($83 Mn). The 60% holding is in the equity share capital of Vitalic. Further, the company also gets 100% ownership of the subsidiaries of Netmeds. These include Tresara Health Pvt Ltd, Netmeds Marketplace Ltd and Dadha Pharma Distribution Private Limited. These businesses collectively manage the business of pharma distribution and sales and business support services.

Commenting on this development, Netmeds’ founder and CEO Pradeep Dadha, said:

“As a third-generation entrepreneur, I have the greatest admiration for Reliance, the biggest global Indian brand and a multinational conglomerate, which has the welfare of every Indian at the heart of its operations. With the combined strength of the group’s digital, retail and tech platforms, we will strive to create more value for everyone in the ecosystem, while providing a superior Omni Channel experience to consumers. In the coming years, we will cover many more cities, serve many more customers, expand to many more categories and work to fulfil the ‘Make in India’ dream.”

About Netmeds

Pradeep Dadha founded the e-pharmacy set-up in 2010. The startup is a pharmacy marketplace that offers authenticated prescription and medicine digitally along with other health products. The company has acquired two health tech startups KiViHealth and telemedicine startup JustDoc. As of March 2019, Netmeds claimed to have served more than 3.7 Mn customers in over 610 Indian cities and towns.

About the Deal

In the BSE fillings, Reliance highlighted that it has acquired the company through a mix of secondary and primary investment. The fillings highlight that it will acquire at least 80% stake by April 2024. Further, there will be an option to increase it to 100% ownership. The former believes that this investment will allow it to further enhance the affordable availability of essential quality health care products and services. Alongside this, the investment will also increase its digital offerings. But, the Indian government is yet to launch e-pharmacy guidelines. Thus, Reliance did not require any regulatory approvals for the said investments.

Speaking on this strategic investment, Isha Ambani, Director, RRVL, said:

“This investment is aligned with our commitment to provide digital access for everyone in India. The addition of Netmeds enhances Reliance Retail’s ability to provide good quality and affordable health care products and services and also broadens its digital commerce proposition to include most daily essential needs of consumers. We are impressed by Netmeds’ journey to build a nationwide digital franchise in such a short time and are confident of accelerating it with our investment and partnership.” 

Incorporated in 2015, Vitalic and its subsidiaries are in the business of pharma distribution, sales, and business support services.