Snapdeal receives Rs113 crore from Nexus, founders in surprise funding
The funding round led by Nexus and founders Kunal Bahl and Rohit Bansal comes as a surprise as Snapdeal is being prepped up for sale to Flipkart by SoftBank
Bengaluru: Struggling online marketplace Snapdeal has received Rs113 crore in an emergency financing round from existing investor Nexus Venture Partners and the company’s founders.
The funding will not affect Snapdeal’s proposed sale to Flipkart, three people familiar with the matter said, on condition of anonymity. Snapdeal (Jasper Infotech Ltd) has been in talks to sell itself to bigger rival Flipkart amid a boardroom battle involving its three most powerful investors and its co-founders Kunal Bahl and Rohit Bansal.
Japanese technology and telecoms conglomerate SoftBank Group Corp, Snapdeal’s largest investor, is trying to engineer the sale after giving up on the online marketplace, which has lost out to Flipkart and Amazon India in the e-commerce battle. At the other corner are Nexus, Kalaari Capital and the Snapdeal co-founders, all of whom were initially opposed to the sale.
Nexus, one of Snapdeal’s earliest backers, was issued shares worth Rs96.26 crore in the latest round, documents with the Registrar of Companies (RoC) show. Snapdeal chief executive Bahl and chief operating officer Bansal received shares worth Rs8.45 crore each, the documents show.
One of the people cited above said that the share issuance is connected with Snapdeal’s acquisition of software provider Unicommerce eSolutions Pvt. Ltd, which counted Nexus, Bahl and Bansal among its investors, in early 2015. This person said Nexus and the Snapdeal founders were issued shares in Snapdeal in lieu of their stake in Unicommerce. Mint couldn’t verify this.
Mint reported on 28 April that Snapdeal then had cash reserves left for less than four months.
Snapdeal, Nexus, SoftBank and Flipkart didn’t immediately respond to emails seeking comment.