NEW DELHI, Oct 28: Snapdeal today said Japanese telecom giant Softbank will invest USD 627 million (about Rs 3,762 crore) in the company, becoming the largest shareholder in the online marketplace major.
This is the largest investment made by a single investor in an e-commerce company in India. Other existing investors have also participated in this round of investment but the company declined to disclose the amount.
Snapdeal will use the investments in expanding its chain of fulfilment centres and make acquisitions in the coming few months specifically in the area of mobile technology.
With mobile commerce fast gaining pace in the country, the city-based firm also plans to set up an incubation centre to hone and harness start-up businesses in the mobile technology space within next 6 months.
Through this strategic investment and partnership with Snapdeal, the SoftBank Group aims to further strengthen its presence in India and leverage synergies with its network of Internet companies around the world, Snapdeal said in a statement.
Snapdeal has raised close to USD 1 billion during this calendar year. Founded in 2010, Snapdeal has more than 25 million registered users and more than 50,000 business sellers.
“We believe India is at a turning point in its development and have confidence that India will grow strongly over the next decade. As part of this belief, we intend to deploy significant capital in India over the next few years to support development of the market,” SoftBank Corp Chairman and CEO Masayoshi Son said.
SoftBank has pledged an investment of USD 10 billion (over Rs 60,000 crore) in India’s IT and communications space, one of the biggest investment commitments from a Japanese firm after Prime Minister Narendra Modi’s visit to that country.
“India has the third-largest Internet user base in the world, but a relatively small online market currently. This situation means India has, with better, faster and cheaper Internet access, a big growth potential,” SoftBank Corp Vice Chairman and CEO of SIMI Nikesh Arora said.
Arora will join the board of Snapdeal as part of the strategic investment. (PTI)
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