Titan, CaratLane Strike A Deal, Employees Hit Jackpot (Image: instagram.com/caratlane)
Until recently, Titan held 71.09 percent stake in Caratlane. Now, Titan would be taking over the rest of 27.18 percent for Rs 4621 crores, owning up to 98.28 percent in the startup. With the regulatory approvals, the deal is expected to wind up by 31 October, 2023. The rest of 1.72 is the ESOP of the employees.
Caratlane employs around 1500 people, the majority of which are on the retail and manufacturing part of the business, instead of shares in the company, they are given bonuses and hikes only. The remaining employees, almost 400, are part of the startup’s corporate team, to whom, giving ESOP’s were common. Among this 400, about 75 are Caratlane’s shareholders, which are worth 340-380 crores now, which would in turn be 1.72 percent in CaratLane.
Titan is said to be on the move to buy this from the employees as Titan plans on holding 100 percent in the company.
The first deal came about in 2016, when Titan bought 62 percent for 357 crores, with a discount of 20%. Now, Titan is acquiring 27.18% for 4621 crores, valuing it at about 17,000 crores ($2billion). Now, “the ESOP component (of 1.72 percent in the company) will also be bought out at the same time by the end of October. A bunch of it will be done by then and whatever remains, Titan will buy as and when the vesting happens,” the founder of CaratLane, Mithun Sachetti said, reported moneycontrol.com
CaratLane is an Indian jewellery retailer, founded by Mithun Sacheti in 2008, it offers gold and diamond jewellery, both on online and offline mode, with headquarters in Chennai.
Till recently, ESOP’s were not considered as a significant proposal for employees in startups as, it turning into real shareholding and later into money was doubted but with some success stories IPO’s of Paytm, Delhivery and Zomato, and ESOP liquidity of other smaller startup’s the situation is on the change.
