FLIPKART TAKES TIME TO UNVEIL SNAPDEAL OFFER
SNAPDEAL’S JOURNEY
Even as time runs out for the closure of the biggest consolidation in the history of Indian e-commerce sector, online marketplace Flipkart is yet to come up with a number for Snapdeal acquisition.
According to sources close to the Snapdeal board, Flipkart has completed its due diligence and has found everything clean. However, the source said, the board has still not got any final offer. “We are hoping that the deal gets closed by next week,” the source added.
Flipkart did not respond to a mail sent to them on the issue. In the last one month, the ecommerce firm has checked Snapdeal’s books with a finecomb and completed its due diligence a few days back.
If the deal is not closed in the next few days, the Snapdeal board would have to extend the timeline or put the company on the block again. “The exclusivity clause ends next week. If they do not come back with an offer (before that), SoftBank, as well as other investors, can either extend the timeline or it can be open season,” the person added.
However, others say the deal would get finalised in the next few days and an announcement would be done by next week. “We are hopeful. In the due diligence, the company came out clean,” said another person who is close to the developments.
Flipkart, which would get more than a billion dollars, and Japanese telecom major SoftBank, as a backer, are keeping cards close to their chest. Also, the SoftBank board is trying to bring everyone on board regarding the sale. Investment bank Credit Suisse, which is advising Snapdeal on the proposed 2010 Launched as discount deal site Initial investment: ~10 lakh 2011 Pivots to an online marketplace, inspired by Alibaba Total number of funding rounds: 11 Total funds raised: $1.56 billion Total number of investors: 23 deal, is also said to be reaching out to smaller shareholders to get them on board.
The firm has a number of investors including PremjiInvest, Ontario Teachers’ Pension Plan, Ratan Tata, Foxconn, Temasek and BlackRock, among others.
Many of the minority shareholders, including PremjiInvest, the personal investment arm of Wipro Chairman Azim Premji, have written to the company on more than one occasion seeking greater clarity on the terms of the deal. Unhappy with the way they have been dealt with, many minority shareholders have called for equal treatment for payouts from the deal.
A lot of things are being worked out around the Snapdeal-Flipkart merger. Three separate sets of talks are happening for the other firms under Jasper Infotech brand, Snapdeal’s parent firm.