The wave of consolidation in the e-pharmacy industry continues, with Reliance Industries Limited announcing on Tuesday that its subsidiary has acquired a majority equity stake in online medical store Netmeds for Rs 620 crore cash consideration. This comes hours after rivals PharmEasy and Medlife filed for approval for a merger with the Competition Commission of India.
This, Reliance said, represents a nearly 60% holding in Vitalic Health, the parent company of Netmeds and a 100% direct equity ownership of its subsidiaries. Netmeds connects customers to pharmacists and enables doorstep delivery of medicines, nutritional health and wellness products.
Isha Ambani, the director of Reliance Retail Ventures Limited, 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,” she added.
“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,” she added.
Pradeep Dadha, the founder and CEO of Netmeds said, “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.”
Earlier on Thursday, PharmEasy and Medlife filed for approval for a merger, with Medlife to have a 19.59% stake in the combined entity. The valuation of the combined entity could be around $1.2 billion, which would mean Medlife and its promoters will get a stake of about $230 million.
Rules surrounding the sector are vague, with the government yet to notify the draft e-commerce rules. Competition in the sector is set to intensify with Amazon already launching Amazon Pharmacy in Bengaluru (and expected to expand), and according to Times of India, Flipkart also looking to foray into the e-pharma market.