SoftBank pushing to seal Flipkart-Snapdeal merger
MUMBAI: After ploughing about US$2 billion (RM8.68 billion) into minority stakes in Indian e-commerce businesses over the past years, Japan’s SoftBank is upping the stakes, looking to play consolidator and take a more active role at a trio of leading start-ups.
According to sources, the solar-to-tech conglomerate is seeking to secure a piece of India’s industry leaders in everything from payment systems to online shopping and groceries, in a series of deals that would shake up the US$65 billion sector.
Among the most high-profile plans is SoftBank’s push to engineer a merger between Snapdeal, the No. 3 player in one of the world’s most competitive online markets and one of its biggest Indian investments to date, and market leader Flipkart.
The deal could be finalised as soon as next week, said sources.
SoftBank has poured roughly US$1 billion into Snapdeal since 2014, but competition in e-commerce has risen dramatically with United States giant Amazon.com cranking up its presence and taking the No. 2 spot from Snapdeal.
Besides Snapdeal, SoftBank is also close to finalising a cash infusion of more than US$1 billion into Alibaba-backed digital payments firm Paytm — another leader in a highly competitive sector — giving it a more direct say in that group too, according to one source.
Media reports have separately linked SoftBank to a tie-up between grocery delivery group Grofers, in which it has invested roughly US$70 million, and market leader and rival BigBasket.
At the heart of the push was Masayoshi Son, SoftBank’s founder and chairman, said the sources. Son has taken a more active role in the group since last year, when he pushed aside his heir apparent, Nikesh Arora.
SoftBank is best-known for its lucrative early stage bet in Chinese e-commerce giant Alibaba Group.
“Son is thinking India is the place where he will create one or two Alibabas,” said one of the sources familiar with SoftBank ambitions, adding that Son saw the country right now as the “land of golden opportunity”. Reuters