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Global Fashion Group secures €300M from Rocket Internet

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Global Fashion Group has raised €300 million (~$345.57M) from Rocket Internet. Rocket Internet will underwrite €100 million, it will invest €85 million while converting the existing investment at the terms of financing.

Jabong’s MD and CEO Sanjeev Mohanty said in a statement that the funding will help Jabong to enhance its business operations in India. According to Mohanty, the past few months were its best in terms of revenue.

In July last year, Global Fashion Group raised euro 150 million (~$166 million) in a round of funding from existing investors Rocket Internet and AB Kinnevik. With this investment, Kinnevik would own at least 25.0% and Rocket at least 21.9% of GFG.The fashion platform would use the funds for logistics, marketing and product development. It also acquired two Brazilian online fashion businesses, Tricae and Kanui, is a share for share transaction.

The Global Fashion Group operates in 28 countries under different businesses and employs 9,500 people. In September 2014, Rocket Internet had merged Jabong with four other online fashion retailers in Latin America, Russia, Middle East, South-East Asia and Australia to create Global Fashion Group.

Financials: Last month, Jabong reported revenues of Rs 218.53 crore in the fourth quarter of 2015. This represented a decline of 19.3% from Rs 270.75 crore in the same quarter last year. The company also reported a gross merchandise value of Rs 377.73 crore, a decline of 19% y-o-y from Rs 465.61 crore. Net loss for the company in Q4 2015, however, decreased to Rs 1.98 crore.The company added the contribution of mobile share increased 32% in share of revenue.

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Amazon’s earlier attempt to buy Jabong: In November 2014, it was reported that Amazon was in talks to buy Jabong. At the time the deal was pegged at around $1.2 billion. However, the deal did not go through in January following disagreements between the companies over valuation.

Leadership changes:

– In November last year, Jabong appointed Sanjeev Mohanty as chief executive officer (CEO) and managing director of the company, effective early December 2015. He replaced Praveen Sinha, the founder of Jabong.

– In the same week, it appointed Saurabh Srivastava as the chief marketing officer, replacing Praveen Sinha who also handled marketing activities.

– The company also appointed Sumit Jain as its CTO to replace Sachin Sinha who had joined in March 2015. Sinha himself was appointed to replace former CTO Harsh Kundra, who had left the company in January this year to join Tolexo Online.

– In February it appointed Muralikrishnan B as its COO. Muralikrishnan will report to Sanjeev Mohanty and look after the technology, product and digital marketing functions. He will also guide and assist in product management for other Global Fashion Group (GFG) companies, of which Jabong is one.

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