The long running saga over the future of Indian e-commerce firm Snapdeal may be close to a conclusion at last. The company has been repeatedly linked with an acquisition by rival Flipkart, and now a deal worth a touch under $1 billion has been agreed to in principle cover for galaxy s3.
That’s according to a report from Reuters which claims the Snapdeal board has signed off on a takeover from Flipkart that will be priced between $900 million-$950 million. TechCrunch has confirmed this independently via a source with knowledge of discussions. Seven-year-old Snapdeal, which had raised over $1.5 billion from investors that include SoftBank and Alibaba, was valued at $6.5 billion as recently as 2015.
In addition to that sell off, other assets are being offloaded. Economic Times reported that FreeCharge, the payment business that Snapdeal acquired two years ago, will be sold to Axis Bank.
Flipkart’s potential acquisition of Snapdeal would mark the resurgence of the company under new CEO Kalyan Krishnamurthy, who took up the position in January of this year. Under his control, Flipkart — which lost ground on rivals over in recent years — has emerged as the primary rival to Amazon in India wigs long hair.
To push on, Flipkart raised $1.4 billion in fresh funding from eBay, Microsoft and Tencent in April at a valuation of $11.6 billion. While it was once valued as high as $15 billion, merely being in the position to bring in money from global investors was a major achievement, and that’s highlighted by Snapdeal’s own failure to do so.
Amazon itself has invested more than $5 billion into India’s business since it launched in the country in early 2012. Paytm, which is backed by Alibaba, is another big rival in the online commerce space, although it is also focused on mobile payments, banking and most recently mobile games cloud computing companies.