The grapevine says that Global Fashion Group (GFG) Jabong’s parent company has approached Snapdeal with a sale offer. Snapdeal has practically confirmed this news without committing to anything.
In a ‘neither confirm nor deny’ mode, Snapdeal CEO Kunal Bahl said, “At any time, anyone who wants to look at raising money in this market, or is thinking about getting a strategic partner on board, comes and talks to us. We are always considering companies in every space because it is important for us to keep growing our ecosystem. The specifics, though, I can discuss later.”
GFG trying to sell off Jabong
Owned by Rocket Internet and AB Kinnevik, GFG has been reaching out to various possible buyers to take over Jabong. Earlier in September, (21st September to be precise), there were reports that Jabong was discussing a possible buyout with Paytm. The report said that AB Kinnevik, the largest shareholder of Jabong, with 25% stake, was also negotiating for Rocket Internet to sell Jabong.
It wants to sell its stake in the money-losing Indian fashion store ahead of GFG’s proposed stock market listing,” said the report.
US based ecommerce marketplace Amazon was in talks to buy Jabong in late 2014. The deal, rumoured to be valued at $1.2 billion, would have been Amazon’s biggest buy. However, the talks were called off for reasons unknown.
A sweet deal for Snapdeal
If it comes through, the acquisition will put Snapdeal on par with its major competitor Flipkart. Having an online fashion portal as its partner is something Snapdeal has been considering. Adding a fashion portal would help Snapdeal tackle Myntra in a major way. However, talks are at a nascent stage.” says an insider.
Only time will tell if the deal will work through. Till then analysts will be keeping a close watch on the proceedings.
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