Snapdeal-Flipkart merger still at loggerheads

It seems the biggest consolidation of Indian online ecosystem will take some more time to get finalise. Snapdeal, the once online Indian leviathan is losing ground fast and so SoftBank, which has 30 percent stake in the company has favoured its merger with Flipkart, the rival marketplace.

Recently SoftBank has agreed to inject $100 million (Rs 650 crores) into Snapdeal account as an interim measure. But later on, this agreement was abandoned. Currently, Snapdeal’s account is believed to be left with a maximum Rs 600 crores, while it is losing Rs 50-60 crores every month.

The main reason for this historical merger to be on hold is: other investors of Snapdeal, namely Kalaari Capital and Nexus Venture Partners are strictly opposed to the idea that these two once rival marketplaces should be merged. Sources say, SoftBank is thinking of buying out Kalaari Capital And Nexus Venture Partners’s stakes of Snapdeal. Then the merger will be smooth and SoftBank may also retain a 20 perc ent stake in the newly merged company. But nothing has been confirmed officially yet.

Earlier, Paytm was also keen in Snapdeal acquisition. However, that deal did not materialised due to valuation issues. In the current scenario, experts are predicting Paytm can be back again if the proposal of SoftBank does not materialise.