De­spite Snapdeal Buy Flop, Son Vows to Stay En­gaged with Flip­kart

The Economic Times - - Disruption: Startups & Tech - Biswarup.Gooptu@ times­group.com

New Delhi: SoftBank founder Masayoshi Son said that the Tokyo-head­quar­tered con­glom­er­ate re­mains “en­gaged” with Flip­kart, In­dia’s largest ecom­merce com­pany, with the com­ments com­ing a week af­ter the ac­qui­si­tion of its port­fo­lio com­pany Snapdeal the firm was or­ches­trat­ing col­lapsed.

Son also said that he “re­spected the de­ci­sion of Snapdeal founders” to move for­ward as a stan­dalone en­tity. Last week, Snapdeal an­nounced that it had ter­mi­nated all ac­qui­si­tion dis­cus­sions, an an­nounce­ment that was first re­ported by ET in its edi­tion dated July 31.

SoftBank has been widely tipped to in­vest be­tween $1.5 bil­lion and $2 bil­lion in Flip­kart. As part of an un­der­stand­ing be­tween SoftBank, Flip­kart and Tiger Global — Flip­kart’s largest stake­holder — post the ac­qui­si­tion of Snapdeal, the Ja­panese in­vestor was ex­pected to pump in pri­mary and sec­ondary cap­i­tal that would not only en­able Flip­kart to keep ri­val Ama­zon In­dia at bay, but also de­risk Tiger Global’s sig­nif­i­cant ex­po­sure to the com­pany.

Sources close to SoftBank had told ET that the SoftBank would now “go back to the draw­ing board” re­gard­ing its pro­posed in­vest­ment in Flip­kart, fol­low­ing the fail­ure of the ne­go­ti­a­tions be­tween the Ben­galuru-head­quar­tered on­line re­tailer and Snapdeal, in which it owns about 33%.

The pro­posed in­vest­ment in Flip­kart is ex­pected to be made by SoftBank’s mega, $100 bil­lion tech­nol­o­gy­fo­cused Vi­sion Fund, the largest pool of pri­vate cap­i­tal ever as­sem­bled.

How­ever, sources have told ET that the in­vest­ment com­mit­tee of the Vi­sion Fund was ex­pected to dis­cuss the an­tic­i­pated in­vest­ment only later this month. While SoftBank is ex­pected to hold on to its stake in Snapdeal for the fore­see­able fu­ture, it is un­likely to in­vest fur­ther cap­i­tal in the Gurgaon-based on­line mar­ket­place, in which it has al­ready pumped in about $900

mil­lion.

Masayoshi Son, founder, SoftBank

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