Tata already runs large offline retail operations under various brands such as Trent (Westside) and Infiniti Retail (Croma), an electronics and appliances chain. Last year Croma had launched an online store called Cromaretail.
Indiaplaza Chief Executive Officer K Vaitheeswaran was not available for comments. Further details of the deal are not known.
The Tata group also operates mjunction, an online marketplace for steel and coal. The joint venture between the Steel Authority of India and Tata Steel launched in 2001. mJunction has also ventured into other businesses with autojunction and straightline.
It was widely reported earlier that Indiaplaza.com, one of the early entrants in Indian ecommerce space is likely to shutdown as it was unable to raise funds to carry on operations. Indiaplaza has stopped taking new orders and is negotiating settlements with vendors. Many employees have left the company but a few have stayed on.
Indiaplaza has been looking to raise around $5-10 mn from the market for over a year now. The company raised $5 mn from Kalaari Capital earlier. One industry watcher said that it wasn’t aggressive enough like Flipkart or the others and investors weren’t too keen on risking their capital. With fuzzy regulations around e-commerce in India, entry of aggressive new players like Flipkart and the entry of Amazon, venture capitalists aren’t willing to take any more risks on players that weren’t differentiated enough.
In the second quarter of 2013, we saw quite a few e-commerce deals happening. Funds raised by e-commerce companies such as Homeshop18 ( $30 mn from OCP Asia Limited), Caratlane ($15 mn from Tiger Global) and Myntra ($25 mn from Accel Partners & Tiger Global) led to a spike in e-commerce investments in the quarter. A total of $ 102 mn were raised by 15 e-commerce and related ventures between April- June. (Read: Indian Startup Report [Funding Digest]: Q2 2013)