Sources close to the matter have reported that Snapdeal is looking to float its IPO with a $250 million offer. The company is choosing to go public after a stellar year for IPOs in 2021. Let’s get down to the details of the story.
Details of Snapdeal’s Proposed IPO
- Sources close to Snapdeal, the e-commerce retailer, has said that the company is about to launch its IPO looking for $250 million.
- Snapdeal is preparing itself to raise around $200 million at an evaluation of $1.5 billion.
- The initial public offering will most likely be a fresh issue of equity shares as neither present shareholders plans to divest their shares.
- SoftBank Group Corp and Alibaba Group Holdings Ltd. are backing Snapdeal.
Know About Snapdeal
Snapdeal, set up by Wharton Alumnus Kunal Bahl in 2010 was a rival to Flipkart and Amazon. However, the company began to focus more on delivering its products to the middle-class and less affluent persons outside India’s larger cities.
While Snapdeal had emerged as one of the leading e-commerce providers, the spell did not continue for long. It began to lose ground to companies like Flipkart and Amazon.
Back in 2017, this company’s plans for a potential merger with Flipkart fell through. The deal had been keenly overseen by SoftBank, but it failed. Had the deal gone through it would have made the combined Flipkart-Snapdeal a worthy contender of Amazon in this nation.
After the proposed merger fell through in 2017, SoftBank, the Japanese investor, led a funding round for Flipkart, which proposes to launch its IPO. Moreover, Snapdeal has stiff competition from the Reliance conglomerate, which is also looking to enter the market as a competitor to Flipkart and Amazon.
Frequently Asked Questions
- Who are the founders of Snapdeal?
Ans. The founders of Snapdeal are Kunal Bahl and Rohit Bansal.
- Who are some of the investors in Snapdeal?
Ans. SoftBank, BlackRock, Foxconn, Alibaba, Temasek, eBay Inc., Intel Capital, Bessemer Venture Partners, Premji Invest, Mr. Ratan Tata, among others, are some of the investors in Snapdeal.
- When was Snapdeal founded?
Ans. Snapdeal was founded on 1 February 2021.
- How much will SoftBank need to sell to allow Snapdeal to become a professionally managed company?
Ans. SoftBank will need to sell a small portion of its stake to come below the 25% shareholding. Presently, SoftBank holds a 35.67% stake in this company.