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Microsoft joins B2B platform Udaan’s $225 million debt round

Microsoft Corporation has joined Udaan, a business-to-business (B2B) e-commerce platform, in financing $225 million through the issuance of convertible debt, according to Aditya Pande, the company’s chief financial officer, in an email to workers on April 18. Microsoft cooperation comes ahead of Udaan’s intentions to go public in the next 12-18 months.

“We are excited to announce that Microsoft Corporation joined our convertible notes offering launched in October last year. M&G Prudential, Kaiser Permanente, Nomura, TOR, Arena Investors, Samena Capital and Ishana Capital amongst others participated in the convertible notes offering round,” Pande authored in the mail, a copy of which has been seen by Moneycontrol.

The company’s convertible note offering, which was launched in October 2021, was two-fold oversubscribed. Last year, the round was valued at $200 million, but thanks to Microsoft and other investors, it has now grown to $225 million.

When Udaan obtains funds again, or during its planned Initial Public Offering, the notes will be converted into equity (IPO).

The decision to strengthen the balance sheet by issuing mandatory convertible notes to IPO reflects Udaan’s ongoing capital strategy and is in line with our plans to go public in the next 12 to 18 months.

With the completion of the convertible notes deal, Udaan has raised roughly $275 million in total funds through debt and convertible notes in the last six months.

Udaan last raised equity capital in January 2020, at a valuation of $3.1 billion. DST Global, Lightspeed Venture Partners, and GGV Capital are among its investors.

Vaibhav Gupta, Amod Malviya, and Sujeet Kumar, three former executives of Flipkart, founded the company in 2016. It operates in a variety of categories, including lifestyle, electronics, home & kitchen, staples, fruits & vegetables, FMCG, pharma, toys, and general merchandise.

Gupta was appointed as CEO in September of last year, as part of the company’s progression toward becoming a publicly traded corporation in 18-24 months. There was no CEO structure in place prior to the announcement, with the three co-founders dividing up responsibilities.

According to Udaan, the site has over 3 million users, 1.7 million stores, and 30,000 vendors around the country.

The platform, which is founded on solid technology, provides supply chain and logistics operations centered on B2B trade for daily delivery throughout 900+ locations and 12,000+ pin codes through udaanExpress.

It allows small enterprises, manufacturers, and merchants to build their operations by providing financial products and services through udaanCapital.

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