India’s second largest e-commerce firm Snapdeal.com on Tuesday said it has raised $500 million (about Rs 3,269 crore) in fresh funds, in a round led by Chinese e-commerce firm Alibaba Group, Foxconn Technology Group and existing investor Softbank Group. Importantly, this is the second investment of Alibaba in India and in e-commerce. Existing investors Temasek, BlackRock, Myriad and Premji Invest also participated in the latest funding round. The company had raised more than $1 billion, from investors including Softbank ($627 million) and iconic business leader Ratan Tata (personal investment).
Snapdeal valued at $4.8 billion after raising $500 million fresh funds:
Started in February 2010, New Delhi-based Snapdeal is one of India’s first ecommerce companies to adopt a marketplace model, which is now the preferred model in the sector over the traditional inventory-based business. With over 150,000 sellers on its platform and more than 15 million products, Snapdeal currently reaches over 5,000 cities and towns across the country. The deal, which has been in the works since the start of the year, values Snapdeal at about $4.8 billion post money, according to official documents filed by FIH Mobile, a unit of Taiwanese contract manufacturer Foxconn.
Foxconn said it is buying a combination of new and existing shares worth $200 million for a 4.27% stake. It will infuse about $150 million as fresh capital for a 3.11% stake, and about 1.16% stake worth $50 million will be bought from eBay Singapore Services Pvt. Ltd.
In India E-Commerce is growing at a blazing pace:
“We see this milestone as a significant endorsement of Snapdeal’s strategy and commitment to create life changing experiences for millions of small businesses and consumers in India,” Snapdeal Co-Founder and CEO Kunal Bahl said. He added, with global leaders like Alibaba, Foxconn and SoftBank supporting the company, its efforts towards building India’s most impactful digital commerce ecosystem will be propelled further, enabling it to contribute towards creating a Digital India.
Also Read: YourStory Secured Series A Funding From Kalaari, Ratan Tata
Over the last two years, the intensity of competition has heightened in the Indian ecommerce space. And the fight for the top slot has evolved into a three-way tussle among global giant Amazon Inc, Bengaluru-based Flipkart and Snapdeal. Rivals Flipkart and Amazon have also committed to invest about $8 billion (roughly Rs. 52,341 crores) over the next few years in India, where e-commerce is growing at a blazing pace, driven by affordable smartphones and increasing Internet penetration.