CaratLane employees would be receiving Rs 340-380 crore in Employee Stock Ownership Plan (ESOP) payout. This, as Titan is set to acquire the remaining stake in the Jewellery startup.
As per Moneycontrol, CaratLane has around 1,500 employees in total, of which a majority are on the retail and manufacturing side of the business and don’t have shares in the company. Instead, they are rewarded with bonuses and hikes.
The remaining about 400 employees who are part of CaratLane's corporate team hold ESOPs. Out of the 400 employees, 75 of them have shares in CaratLane which are now worth Rs 340 crore -380 crore and account for about 1.72% in the jewellry startup.
As Titan is looking to own 100% in the startup, it will buy the stake from the employees. Titan currently holds 71.09% of the stake and is planning to buy another 27.18% stake from Sachetti and his family for Rs 4,621 crore. The deal is expected to close by October 31, 2023, subject to regulatory approvals.
Mithun Sachetti, Co-Founder and CEO of CaratLane has told Moneycontrol that Titan will buy the ESOPs as and when the vesting happens.
“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,” Mithun Sachetti, co-founder and CEO of CaratLane told Moneycontrol.
The ESOPs started gaining interest after numerous startups like Zomato, Paytm, Delhivery saw successful IPOs