Reliance Consumer Products, a wholly owned subsidiary of Reliance Retail, is acquiring D2C snacking firm TagZ Foods for INR 28 crore ($3.5 million) in what appears to be a distressed sale.

TagZ has raised around $3.2 million in fundraising over numerous rounds to date. The magnitude of the transaction may change following due diligence, according to a regulatory filing.

Questions about the deal were not answered by Reliance Consumer or TagZ as of the publication of this piece.

Earlier, sources told Inc42 that the D2C brand suspended production a few months ago due to difficulties scaling its business. Its products have been unavailable on ecommerce platforms and in retail stores for some months.

According to the reports, this led to a number of staff leaving the firm.

Anish Basu Roy and Sagar Bhalotia founded TagZ in 2019 as an omnichannel snacking firm that distributes popped potato chips, gourmet dips, and pastries.

The firm, which also appeared on Shark Tank India, recently received an unknown amount of money from former Indian batsman Shikhar Dhawan. He was later appointed as a brand ambassador.

Previously, TagZ raised $2 million in a pre-Series A investment round headed by 9 Unicorns. Earlier, it raised $1.2 million in its seed round led by 9 Unicorns. It had raised $1.2 million in a seed fundraising round from a group of angel investors in 2020.

TagZ's backers include Dexter Angels, Agility Ventures, Venture Catalysts, and Klub. It competes with BRB, Too Yum, Lays, Uncle Chips, and others.

In FY23, the company recorded a net loss of INR 10.7 crore on INR 9.6 crore of operating revenue.