According to Reports: Softbank, who is largest shareholder of Snapdeal, held a board meeting regarding the sale of online marketplace to the rival Flipkart. If the deals come through, which will be taking place within next 3 weeks could value Snapdeal at approximately $1 billion.
It shows that, one of the India’s biggest online marketplace Snapdeal is preparing itself for the merger with rival Flipkart, as reported by Business Standard. This decision is not made immediately but after several month of negotiation and discussions.
According to the terms proposed by Japanese media and telecom conglomerate, Snapdeal shareholders will get one share of every ten they own of the country’s largest eCommerce company. Two of the early investors of Snapdeal Nexus Venture Partners and Kalaari Capital, have also asked Softbank for about $100 million each from the sale. The proposed sale could see SoftBank pick up a 33% stake in India’s largest commerce company for about $1.5 billion, in the process buying out $500 million to $1 billion worth of Tiger Global’s holding in Flipkart, according to two people aware of the matter.
If the deal gets complete, it will mark the biggest acquisition in Indian eCommerce and also redefine the contours of online retail market where America’s Amazon and China’s Alibaba are also prime contenders.
“A final decision on the sale is yet to be taken,” the person said, as of reports. The board meeting which held on Tuesday signals easing of tensions among Snapdeal’s early investors, Kalaari Capital and Nexus Venture Partners.
In Snapdeal, Softbank holds 33% stakes while Kalaari Capital and Nexus Venture Partners own about 8% and 10% respectively and the two co-founders together own about 6.5% of the company.
Softbank is very much eager for sale of Snapdeal and is looking for every possible way to make the deal possible, as said by one of the persons in the know of the developments said.