Flipkart All Set To Takeover Rival Snapdeal
Flipkart is reportedly closing in on taking over e-commerce rivals Snapdeal. A report claims that the Snapdeal board has accepted Flipkart’s offer in the region of $900-$950 million last week. The future of Snapdeal has been a topic of discussion for the longest time and looks like the speculations will finally end now as the deal reaches a completion.
Snapdeal has raised over $1.5 billion over the years including, from investors such Alibaba and Softbank. Snapdeal was valued at $6.5 billion as recently as 2015 and is now set to be taken over by Flipkart for under $1 billion. It has also been reported that other assets such as FreeCharge, which Snapdal acquired two years ago will be sold off to Axis Bank.
Flipkart’s new CEO Kalyan Krishnamurthy, who took up the position in January of this year seems to be on the track of resurging the e-commerce giants. Under his leadership, Flipkart looks to be preparing to go head-on against global e-commerce leader Amazon. Flipkart also recently raised funding of $1.4 billion from eBay, Microsoft and Tencent at a valuation of $11.4 billion. All in the while acquiring eBay.in under its portfolio.
eBay recently sold its India business, eBay India Private Limited, to Flipkart.
With Snapdeal’s acquisition, Flipkart and Amazon will be the only players in the e-commerce space and this duopoly is a bad news for any other up-and-coming e-commerce player. Flipkart seems to be making up the ground it lost to Amazon in the recent past and this aggressive Snapdeal acquisition is just another step towards gaining back that power position.
Amazon’s heavy investments in their Indian businesses, as much as $5 billion, since it launched India operations in late-2012 indicate that Amazon is serious about turning this duopoly into a monopoly. The e-commerce war is in full swing and it’ll be interesting to see how this pans out in the coming years.