After Snapdeal rejected a ₹5500 crores buyout offer from Flipkart, the latter company is now working on a revised plan. According to the newly revised plan, Flipkart is looking to offer ₹6000 crores (Approx $950 Millions) for buying out the troubled eCommerce company.
The announcement hasn’t been made public, however, according to the sources involved in the development, Flipkart might present the revised plan sometime next week. The revised plan is still lower than the rumoured ₹6500 crore ($1 Billion). According to the sources, Flipkart has also asked the founders of Snapdeal, Kunal Bahl and Rohit Bansal to sign a non-compete agreement, which will bar them from entering the eCommerce business for next few years.
The sale of Snapdeal to Flipkart is being steered by Softbank, the largest investor in Snapdeal. According to the agreement, Flipkart will acquire Snapdeal and to complete the deal, Softbank will invest around ₹10,000 crores in the merged entity. With the proposed investment in Flipkart, Softbank plans to acquire a significant minority stake in Flipkart to take on other global players, like Amazon and Alibaba in the Indian eCommerce market. Amazon runs its Indian subsidiary whereas Alibaba has a significant stake in Paytm Mall.
Snapdeal had provided an exclusivity window to Flipkart for the sale, which got over earlier this month. Snapdeal has started looking out for buyers for its logistic and online payment solutions, called Vulcan Express and Freecharge.
Though there is no certainty over the future of Snapdeal and the deal, the new offer might just continue to make this merger a hot topic for the startup world. We will keep you updated with the latest updates regarding this merger, stay tuned!