In the last few days, a number of companies have been rumoured to show interest in Freecharge, the mobile payments brand owned by Snapdeal. After reporting Snapdeal’s negotiations with Paytm, Flipkart and Axis Bank to sell Freecharge, we have a new entrant in the club today.
According to the ongoing media reports, the leading telecom company of the country, Bharti Airtel is in talks with Jaspers Infotech (Snapdeal’s parent company) to acquire Freecharge. The financials of the proposed acquisition have not yet been disclosed, however, the reports claim that Airtel executives have held a number of meetings with the top management of Snapdeal and are conducting a due diligence for Snapdeal.
Airtel has recently got the licence to operate payments bank and it was the first company to start providing services to the customers. It also runs an online wallet as Airtel Money. The move to acquire freecharge could boost its aggressive approach of acquiring customers for the online payment services. Direct mail to Airtel PR and executives were not answered, however, one of the executives termed it as market speculations and denied any such development.
Just a day back, we had reported about Axis Bank conducting a due diligence to acquire Freecharge from Snapdeal and with this new announcement, the competition to acquire Freecharge seems to be getting bigger. Snapdeal had paid approx ₹2500 crores to acquire Freecharge in 2015 and lately, the interested buyers have not valued Freecharge for anything over ₹200 -₹250 crores.
The fluctuation in Freecharge’s valuation is largely based on the troubled year for Snapdeal. Over the last few months, Snapdeal’s investors, led by Softbank have been proposing the sale to Flipkart. Flipkart made a recent offer of ₹5500 crores to acquire Snapdeal, however, the offer was rejected by Snapdeal’s board. Currently, Snapdeal is eyeing to sell its subsidiaries and assets in order to raise additional cash to keep the company going.
We will keep you updated about more information that we get about the acquisition of Freecharge. If you have any views, feel free to share with us in the comments section. Stay tuned for more such updates.