In a bid to tap on the booming e-commerce industry in India, Chinese business-to-business giant Alibaba is considering to invest in local online retailer Snapdeal, reports Economic Times. Also Read - Jack Ma's Alibaba fined record $2.7B by ChinaAlso Read - Ant Group ordered by China to reexamine its fintech businesses and return to its roots as a payments service
Alibaba entered the Indian market in 2008 with a multi-year strategic partnership with Infomedia India Limited, a leading media company particularly strong in offline Yellow Pages and physical media. The report states that Alibaba is now holding discussions with Snapdeal for a possible investment in the Indian company. However, a definite decision has not been reached yet. Also Read - India bans 43 more Chinese apps over security concerns
The report further mentions that so far, Alibaba has only been linking Indian merchants with overseas buyers and sellers. If it enters the Indian online retail space by aligning with Snapdeal, it will be competing directly against market leader Flipkart and Amazon. While the Chinese company would be a late entrant, it has the advantage of size by sales Alibaba is bigger than Amazon and eBay combined and cash (it will raise up to $25 billion in the IPO this week in US).
Alibaba is not the only company that has shown interest in Snapdeal. It has also attracted attention from other Asian conglomerates including Japan’s largest e-commerce company Rakuten and communications provider SoftBank.
Delhi-based Snapdeal, in which Ratan Tata holds a stake has raised a total of $233 million in two rounds of investments, which saw participation from eBay and billionaire Azim Premji’s family office Premji Invest. The last round in May valued the firm at $1 billion.