Snapdeal has raised over Rs. 113 crores from early investor Nexus Venture Partners and founders Kunal Bahl and Rohit Bansal, amid talks of a potential sale of the e-commerce firm to larger rival Flipkart. NVP pumped in Rs. 96.26 crores in the round, while Bahl and Bansal contributed Rs. 8.45 crores each, according to a regulatory filing with the Ministry of Corporate Affairs.
The shares were allotted on March 10, 2017, it added. Bahl and Bansal were allotted 1,300 Series J preference shares, while Nexus was given 14,810 preference shares, the filings showed. It is not clear how long the fresh financing round will help Snapdeal in continuing operations as it faces intense competition from rivals Flipkart and Amazon.
Emails sent to NVP and Snapdeal remained unanswered. The cash-strapped firm, over the past few months, has trimmed workforce and shut down non-core operations in a bid to control costs. Also, the development gains importance as Snapdeal’s largest investor SoftBank has been proactively mediating a potential sale of Snapdeal to Flipkart for the last few weeks. The Japanese investment firm, according to sources, has succeeded in getting Board members to agree to the said sale and a term sheet for due diligence with Flipkart has been signed. SoftBank has already written off over $1 billion on the valuation of its investment in Snapdeal.
One of the leading contenders in the Indian e-commerce space, Snapdeal has seen its fortunes failing amid strong competition from Amazon and Flipkart. Compared to a valuation of about $6.5 billion in February 2016, the sale to Flipkart could see Snapdeal being valued at about $1 billion. The deal between Snapdeal and Flipkart, if completed, would mark the biggest acquisition in the Indian e-commerce space. ALSO READ: Paytm to acquire FreeCharge, Flipkart to takeover Snapdeal; signs non-exclusive term sheet