In one of the biggest acquisition in the history of Indian internet industry, Indian eCommerce major Snapdeal has acquired mCommerce payments firm Freecharge for an undisclosed amount. However according to sources the acquisition was made for about $450 million in cash and stock.The synergies of the two are expected to build the most impactful digital commerce ecosystem in India.
The news of the deal was broken by FreeCharge’s founder, Kunal Shah , on Facebook . Snapdeal and FreeCharge combined together have a user base of over 40 million and a total of 30 million app downloads (FreeCharge 10 million) on play store.Both the platforms combined together witness >1 million transactions daily.
This acquisition of FreeCharge by Snapdeal has surpassed the previous big buy of Myntra by Flipkart last year.In May 2014, marking the biggest consolidation in the e-commerce space in India till date, Flipkart had acquired Myntra in an estimated Rs 2,000 crore deal.
In October last year, Snapdeal received $627 million investment from Japanese telecom and internet firm SoftBank Corp. The company has been very aggresivel acquiring ventures since the beginning of 2015.
Last month Snapdeal acquired a stake digital financial products distribution startup RupeePower as well as logistics firm QuickDel Logistics Pvt Ltd, which runs operations under the GoJavas brand.
Early this year Snapdeal also bought lifestyle e-tailer Exclusively.in to add to its lifestyle e-com vertical. Exclusively.in was previously acquired by Myntra .In the past, Snapdeal also picked up a stake in Smartprix Web Pvt Ltd, which runs online product and price comparison site Smartprix.
In February this year, Freecharge raised $80 million in funding from investors including Valiant Capital Management & Tybourne Capital Management. In September last year, FreeCharge had raised $33 million in Series B funding. Till now, FreeCharge has received close to $117 million in total funding.
The Indian e-commerce industry is surely seeing mobile as a big part of their strategy. The acquisition of Freecharge by Snapdeal might spell trouble for Amazon, Flipkart who are trying to go strong on their mobile strategy and for Paytm, Freecharge’s direct rival which entered the retail space last year.
