Snapdeal attracts US$500m investment
Print Edition
CHINA’S Alibaba Group Holding, Japan’s SoftBank Group Corp and Foxconn will lead an investment of US$500 million in India’s Snapdeal, the online marketplace said yesterday, as it seeks to expand in the country’s fast growing e-commerce sector.
The move is a vote of confidence from three of the world’s biggest technology companies in Snapdeal, which in October got a US$627 million investment from SoftBank, also an early backer of Alibaba.
Snapdeal, which bills itself as India’s version of Alibaba, did not break out individual investments. EBay Inc, an early backer of the company, is selling part of its stake in a transaction which also involves fresh funding.
Existing investors Temasek, BlackRock, Myriad and Premji Invest also participated in the funding round, Snapdeal said, without giving further details.
EBay said in a statement that it has sold a portion of its stake and would focus on boosting its own business in the country.
Separately, FIH Mobile, a unit of Taiwan-based Foxconn, the trading name of Hon Hai Precision Industry Co, said it was buying a 4.27 percent stake in Snapdeal for US$200 million via its Singapore-based subsidiary Wonderful Stars Pte.
Sources said this month that the transaction would value Snapdeal at more than US$5 billion.
In India, Snapdeal rivals Flipkart, valued at around US$15 billion, and Amazon.com Inc’s India unit as the three fight it out for a share of a US$22 billion market.
Like its rivals, Snapdeal sees the majority of its transactions on smartphones and mobile devices.
“That is why, with a significant share of e-commerce transactions in India being done via mobile devices, the investment positions FIH to benefit from Snapdeal’s platform,” Foxconn said in a statement.
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