V-Mart set to acquire Tiger Global-backed LimeRoad in a distress sale

Fashion retailer V-Mart Retail has signed a definitive agreement to acquire online fashion marketplace LimeRoad at a lump-sum amount of Rs 31.12 crore, according to the company’s regulatory filings filed with NSE (National Stock Exchange).

This is a distress sale as LimeRoad has raised over $50 million from investors such as Tiger Global, Matrix Venture Partners, Lightspeed among others.

“V-Mart Retail Limited has entered into a business transfer agreement on October 17  with A.M. Marketplaces Private Limited (LimeRoad) and certain other parties for the acquisition of its LimeRoad Business,” mentioned filings.

According to the filings, the acquisition of LimeRoad will help VMart to expand its presence in Omni channel value fashion retail. Vmart will also invest Rs 150 crore in LimeRoad to scale omnichannel biz.

The firm will continue to operate LimeRoad as an independent business unit. Suchi Mukherjee, the founder of LimeRoad will join V-Mart’s leadership team as CEO of LimeRoad and the Omni-channel business whereas Ankush Mehra co-founder of LimeRoad continues as COO.

The acquisition appears to be a good deal for LimeRoad which has been struggling to raise new money for the past couple of years. LimeRoad joins the ranks of several fashion-focused e-commerce companies which got acquired in a distress sale. The list includes Voonik, YepMe, Zovi and Koovs among others.

Limeoad’s struggle could also be evident from its shrinking scale which dwindled 13% to Rs 69.31 crore in FY22 from Rs 79.64 crore in FY21. It’s worth noting that the firm registered Rs 179.95 crore in overall revenue during FY20.

Two decades-old V-Mart has penetration in Tier II, III, IV cities through a network of 410 stores. The Lalit Agarwal-led company operates a direct-to-customer (D2C) omni-channel platform vmartretail.com. In addition to this, it is also serving customers through its brick-and-mortar stores at multiple marketplaces.