Flipkart acquires eBay.in, raises $1.4 bn pegging its current valuation at $11.6 bn

Team FactorDaily April 10, 2017

In its latest funding round, Flipkart Group has raised $1.4 billion from Tencent, eBay and Microsoft, the company announced today. The deal includes the acquisition by Flipkart of eBay India. FactorDaily had reported these developments ahead of the current announcement last month, based on several insider interviews.

The press release confirms this, and elaborates that “in exchange for an equity stake in Flipkart, eBay is making a cash investment in and selling its eBay.in business to Flipkart. eBay.in will continue to operate as an independent entity as a part of Flipkart. Flipkart and eBay have also signed an exclusive cross-border trade agreement.”

The three new participants join Tiger Global Management, Naspers Group, Accel Partners and DST Global as Flipkart’s primary investors.

As a result of the partnership between Flipkart and eBay, customers of Flipkart will gain access to global inventory on eBay, while sellers on Flipkart will now have an opportunity to expand their sales globally.

The latest funding round pegs Flipkart’s post-transaction valuation at $11.6 billion. It is the largest in Flipkart’s 10-year history, the company said in a press release.

The announcement comes even as the company gears up to sign a $950 million deal to acquire Snapdeal, India’s third largest e-commerce company.

As per our reporting, Flipkart is looking to close the round at $2 billion with additional funding from Softbank, Snapdeal’s main investor. Freecharge, a recharge and payments company that Snapdeal acquired for a reported $400 million in 2015, is likely to be sold as a separate entity. “The asking price is $100 million,” said a source.

However, according to another source, transactions on Freecharge have declined to three-four lakhs per day whereas its bigger rival Paytm is clocking eight million transactions a day. Freecharge’s plan to onboard offline merchants to accept payments through its platform has also not taken off.

As we’d reported earlier, Alibaba was also in talks to buy Snapdeal but those talks never went far because the Chinese e-commerce company’s offer was “too low”.

Meanwhile, under a new leadership, Flipkart has started hiring again. Kalyan Krishnamurthy, who took over as Flipkart’s new Chief Executive Officer, is said to be hiring for top level positions.


Thank you for reading FactorDaily

We hope this story worked for you.

Our journalism is produced by some of the best brains in the story-telling business who believe that good stories have only one master: you, the reader. Bringing these stories to you, just so you know, costs us a pretty dime even as the context of disruption remains unchanged in the journalism business the world over.

If you like what you read here, consider supporting the FactorDaily journey. We don’t have a paywall because we believe access to good journalism must be free to all, especially when it is in public interest and informs citizens with independence and accuracy. Such stories should not be restricted to a few who can pay. You are free to support us with any amount you like. 

Please note that 18% of your contribution will be paid to government as GST, per Indian accounting rules.