A Snapdeal spokesperson told MediaNama that it was not in discussions with any companies to merge. They said, “We have had no such discussions with anybody at any point in time. This is a sterling piece of speculative journalism by VCCircle – ignores denial by key parties and uses nameless, faceless “direct sources” as the basis for its story. No constraints of truth and flights of fancy make for great tabloid journalism and hopefully grabs some eyeballs too!”
MediaNama reached out to the company after VCCircle reported that it was was in talks with rivals Flipkart and Amazon to explore mergers. VCCircle cited sources saying that the talks were ‘exploratory’. However, the publication also cited Snapdeal as saying that such a merger talk was not happening while a Tiger Global spokesperson denied to offer it any comment. Amazon and Softbank did not comment on the story to VCCircle.
Earlier this month, VCCircle had also reported that Snapdeal was looking to sell a 26% stake in FreeCharge to investors including Foxconn, to which Kunal Shah, FreeCharge chairman said that he would not comment to the publication. Snapdeal acquired Freecharge in April 2015 for a reported $450 million.
For the quarter ended March 2016, SoftBank Group stated that Snapdeal’s gross merchandise value (GMV) had grown 90% year-on-year but did not provide any numbers. From ROC filings, MediaNama found that Jasper Infotech, which runs Snapdeal, reported losses of Rs 1328 crore for the year ended March 2015. This was a sharp increase from Rs 264.6 crore from the previous year. Cash and bank balances stood at Rs 1,299.7 crore. In October last year, Chinese ecommerce giant Alibaba got an approval from the Competition Commission of India (CCI) to buy 4.14% stake in Snapdeal.
In March this year, Economic Times reported that Flipkart was considering selling to Amazon, which Sachin Bansal, the executive chairman of the company called unethical.
..and Flipkart has set up a colony in Pluto! Even by low standards of our tech reporting, this is highly unethical https://t.co/9kUi0oyBga
— Sachin Bansal (@_sachinbansal) March 16, 2016
Funding: In February, Snapdeal raised $200 million from Ontario Teachers’ Pension Plan (OTPP), with participation from Iron Pillar and others. At this time, the 20 year old eBay sold a partial stake in the company for an undisclosed amount to ‘effectively manage its global interests and invest in other strategic initiatives’. It had also raised $500 million in August last year and $627 million in October 2014.
Also read: Quartz’s Speculation is the latest trend in India’s online retail sector