Flipkart Sweetens Its Offer For Snapdeal To $900 Million
Flipkart raises its buyout offer for Snapdeal by $50 million.
Online retailer Flipkart has sweetened its bid for Snapdeal to about $900 million after its earlier offer was rejected by its smaller rival two weeks ago, three people privy to the development told BloombergQuint.
The fresh offer, which includes e-commerce platform Snapdeal and order fulfillment platform Unicommerce, was made late on Monday night, one of the persons quoted above said requesting anonymity as the talks are private. Credit Suisse is acting as the financial adviser to Jasper Infotech Pvt. Ltd., the parent of Snapdeal, in this deal.
Flipkart had made its initial $850-million offer in the first week of July after a month-long due diligence, but that didn’t include Unicommerce, the person quoted above said.
Flipkart and Snapdeal have been in merger talks since April, driven by Japan’s SoftBank Group Corp. If successful, it will be the biggest merger in the Indian e-commerce industry. SoftBank, an investor in Snapdeal, had agreed to cut e-tailer’s valuation by 85 percent to $1 billion for the merger, Bloomberg had reported citing people it did not identify.
After the exclusive pact with Flipkart ended, Snapdeal held early discussions with online retailer Infibeam Inc. While Infibeam offered a valuation of $1 billion, the deal is less likely to fall in its court, the second person quoted above said.
Separately, Jasper Infotech is holding talks to find the right suitor for its digital wallet FreeCharge and logistics arm Vulcan Express. However, Vulcan is most likely to be part of the Flipkart deal, the person said.
Snapdeal, Flipkart, Infibeam, SoftBank and Credit Suisse did not immediately respond to BloombergQuint’s emails seeking a confirmation.
The final decision will be taken by the board of Snapdeal in the coming weeks followed by the shareholder meeting, but the final closure could still be months away, the second person said.
Before the final deal, Snapdeal has a task at hand to pacify some of the minority investors such as PremjiInvest, Wipro’s Azim Premji’s family office, which had also written to the board objecting to special payments to certain shareholders, including its two co-founders and two early backers, according to a Bloomberg report citing people familiar with the discussions
Also Read: What A Flipkart-Snapdeal Marriage Will Mean As SoftBank Plays Matchmaker