Prione Business Services, the joint venture between Narayan Murthy-led Catamaran and Amazon, will be acquired by Amazon. Prione's wholly owned subsidiary Cloudtail India is one of Amazon's largest sellers in the country.
"Amazon will acquire Catamaran’s shareholding in Prione in compliance with applicable laws including all assets and liabilities," the two companies said.
"The businesses of the joint venture shall continue under the leadership of the current management and on receipt of regulatory approvals, the board of Prione and Cloudtail will take steps to complete the transaction in compliance with applicable laws," the statement added.
So far the two companies jointly own Prione Business Services, whose wholly-owned subsidiary Cloudtail India has repeatedly come under the scanner for alleged violation of Foreign Direct Investment (FDI) norms. But now Cloudtail will continue as a seller on Amazon, it wasn't immediately clear if it could continue as post this acquisition since the e-commerce rules bars marketplaces from having any ownership in the firms run by their sellers.
Catamaran Ventures in 2019 raised its stake in Prione Business Services. The step reduced Amazon Asia's stake in Cloudtail to 24 percent from the earlier 49 percent, with Catamaran Ventures’ stake rising to 76 percent from 51 percent earlier.
Following this, Cloudtail hence became part of Amazon Group Company and making it compliant with the rules on the papers but yet not serving the purpose with which the norms were straightened.