Snapdeal secures Dollars 500 million in an investment round led by Alibaba

Online marketplace Snapdeal has raised $500 million (about Rs 3,269 crores) in a fresh round of funding from a clutch of investors led by Alibaba Group, Foxconn, and SoftBank.

Alibaba also invested $200 million in Snapdeal, according to a person familiar with the deal.

Snapdeal has emerged as an e-commerce titan since it was founded initially as a daily deals site in 2010.

But with a stake purchase in Snapdeal, eBay hinted towards a renewed focus on the Indian market, not with its own brand name, but by backing, in what now has become, India’s second larget e-commerce brand. Ebay said it retains a “significant portion” of the initial stake in Snapdeal, but did not provide further details on the share sale.

Also on Tuesday, eBay announced that it had sold part of its stake in Snapdeal, gaining “a strong return”.

eBay said the cash would be redeployed in other areas of its business, adding that it will focus on boosting its presence in India, which it considers an important market in its fast-growing Asia Pacific region, and in which it has been outgunned by the likes of Flipkart, Amazon and Snapdeal in an intensely competitive race for higher marketshare.

As per market estimates, the new round would value the city-based firm at about $4-5 billion.

The company has more than 150,000 sellers and about 15 million-plus products across 500 plus categories listed on its platform.

“We want to create life changing experiences for millions of small businesses and consumers in India”.

“With global leaders like Alibaba, Foxconn and SoftBank, in addition to other venture partners, supporting us, our efforts to build an impactful digital commerce ecosystem will be propelled, enabling us to contribute to Digital India”, Snapdeal co-founder and chief executive Kunal Bahl said in a statement.