Amazon-Future Deal Aims To Enhance Payments Business Of Both Firms, Says Kishore Biyani
The Amazon-Future deal is strategic for making the Jeff Bezos-led firm a part of India’s payments ecosystem, Kishore Biyani says.
The recent deal between Amazon.com Inc. and Future Coupons Ltd. will not only raise money for the Future Group, but is also strategic for making the Jeff Bezos-led firm a part of India’s payments ecosystem, Kishore Biyani said Tuesday.
Amazon will pick up an indirect stake in Future Retail Ltd. after its investment arm—Amazon.com NV Investment Holdings—acquires 49 percent stake in Future Coupons, a promoter group entity of Future Retail, according to an exchange filing on Aug. 23. Future Coupons currently does not own a stake in Future Retail but had recently subscribed to convertible warrants for Rs 2,000 crore.
"We had subscription warrants of our company and we had to raise money, so the (Amazon-Future) deal was struck. Moreover, the investment by Amazon is strategic to become a part of the ecosystem," Biyani, founder and chief executive officer of Futre Group, said in Mumbai.
The Amazon-Future Retail deal is basically aimed at enhancing the payments portfolio of both the companies, said Biyani. Future Coupons handles the digital payments, retail payments and coupon businesses of Future Retail.
“We have a database of 8 billion transactions and 55 million customers. Payments is one platform where we can acquire the customer base,” he said. “And if the customer starts using your payment mechanism then loyalty factor increases. So it’s getting into the ecosystem.”
Future Group has embarked on a Rs 1,000-crore investment plan to create distribution centres for its food-on-demand venture, said Biyani. The group’s supply chain company, Future Supply Solutions, plans to set up about 38 such centres. Called India Food Grid, the project will connect the entire country through a single, multi-layer network.