Snapdeal closer to Flipkart deal

The board of Snapdeal has reached “a broad consensus” over a possible sale of the e-commerce firm to rival Flipkart, according to sources.

Snapdeal’s largest shareholder SoftBank, which had already secured a nod from founders Kunal Bahl and Rohit Bansal and co-investor Kaalari Capital, has now succeeded in bringing investor Nexus Venture Partners (NVP) on board, a source close to deal said. NVP had, till now, resisted the deal proposed by SoftBank on differences over valuation.

While Snapdeal was valued at about $6.5 billion in its last funding round in February 2016, a source said the valuation had taken a beating since then.

“Nexus today gave its nod for the sale of Snapdeal to Flipkart,” the source said. “They have reached an agreement with SoftBank Group so now the way is clear for the Japanese firm to move ahead.”

However, the source said that the term sheet had not been finalised as yet. “There are certain tweaks that need to be made. Term sheet should be ready and finalised in the next few days.”

Once the term sheet is done, the process of due diligence would start. The actual merger could take a couple of months to complete.

It is learnt that Snapdeal founders could get about $25 million each, while NVP and Kalaari could get close to $70-80 million. NVP will additionally also get a stake in the new merged entity.

SoftBank currently owns more than 30% of Snapdeal.

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Printable version | Oct 24, 2021 7:11:28 PM |

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