E-commerce company Snapdeal has rejected e-retail giant Flipkart’s takeover offer amounting to $850 million (approximately Rs 5,500 crore). Flipkart made the offer to acquire Snapdeal for $800-850 million after the due diligence process, however, Snapdeal rejected as its board feels the offer undervalues the company which has a clean due diligence.

Even though Snapdeal’s board has rejected the offer, the discussion is still underway, said media reports quoting sources that are privy to the development.

Snapdeal’s largest investor SoftBank is mediating the sale and the company’s board has representation from founders Kunal Bahl and Rohit Bansal and investors Nexus Venture Partners (NVP) and Kalaari Capital.

Ernst & Young was roped in to prepare the due diligence report on Snapdeal and the offer was made after the agency submitted the report.

During the funding round in February 2016, Snapdeal was valued at $6.5 billion, which later reduced to $1 billion, according to market watchers.

The merged entity is expected to give a major push to the current cutthroat competition going on between Jeff Bezos’ Amazon and India’s very own homegrown e-commerce leader, Flipkart.

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