Titan attempts to break deadlock in acquiring remaining Caratlane stake

By

Isabelle Crossley

Published
Jun 8, 2023

The founders of fine jewellery brand Caratlane and Titan’s parent company Tata Group have reached a deadlock in negotiations over a valuation as part of Titan Company’s plan to buy out Caratlane. 

Despite the current stalemate, the businesses are keen to break the deadlock and come up with a resolution, the Economic Times reported. The dispute arose over the valuation of the residual stake held in the Caratlane business by its founders, who felt their stake had been undervalued. 
 
“It’s an ongoing negotiation- these things take time,” a senior Tata Group executive told ET Retail. “Titan is a listed company, so it has to follow certain guidelines. On the other hand, entrepreneurs want quick solutions as startups need to be nimble.”

Caratlane has been operating in a strategic vendor relationship with Titan Company’s jewellery brand Tanishq since the year 2010. Titan bought into the business in tranches from 2016 to 2019 and Caratlane is now a 72.3% subsidiary of Titan. The business’ founders and some of its employees still hold a 27.8% stake in the business but Titan aims to buy them out. 
 
Titan’s appointed bank to value the remaining stake in Caratlane was Bank of America which valued that stake at between Rs 1,680 crore and Rs 1,960 crore. Caratlane’s founders rejected this valuation, stating that it was too low and suggesting that Titan will have to return with a higher offer.