Infosys’ Narayana Murthy, Sudha Murty earn ₹915 crore from Cloudtail-Amazon deal

Infosys co-founder Narayana Murthy and wife Sudha Murty earned a hefty sum after their investment firm decided to sell off their shares in e-commerce seller Cloudtail. Catamaran sold a 76 per cent stake in the company for ₹1,332 crore ($160 million), according to the company’s reported regulatory filings, with the Murthy couple’s total investment at ₹417 crore ($50 million).

The overall transaction of selling off Cloudtail shares resulted in a profit of around ₹915 crore ($110 million) for Narayana Murthy and Sudha Murty, giving 3X returns on their eight-year-old investment.

The prime reason behind this massive profit for the Murthy family is the success of Catamaran over the last decade and its exceptional growth rate. Catamaran’s ownership in Cloudtail was through Hober Mallow Trust; Sudha Murty held 80 per cent stake in the firm while Narayana Murthy held the rest of the shares.

Cloudtail is a joint venture between Catamaran and Amazon, which was established in 2014 with the primary goal of training and onboarding merchants for Amazon’s e-commerce platform.

Rise and fall of Cloudtail

Infosys founder-backed Cloudtail showed immense growth, soon becoming the largest merchant for Amazon, accounting for over 50 per cent of its overall sales.

However, certain e-commerce regulations led to Amazon reducing its stake in the company, holding just 24 per cent and selling the rest of the shares to Catamaran. Soon, Cloudtail announced that it would stop operating as a merchant in 2022 after a steep decline in sales and profits.

Cloudtail touched its peak in sales at ₹19,000 crore in March 2022, but the profits steeply fell as the sales dropped down to ₹3,100 crore a year later, in March 2023.

Not just the massive ₹915 crore profit from the sale of the shares, but Catamaran is also entitled to an exit bonus of around 20 per cent of the FY2022 revenues of Cloudtail, according to the original partnership agreement with Amazon.