BENGALURU : Three years after achieving unicorn status, online marketplace ShopClues that has been struggling to survive in the competitive e-commerce space in India, has merged with Singapore-headquartered e-commerce platform Qoo10 Pte Ltd, in an all-stock deal.
"ShopClues has received a very small cash infusion from (Singapore-based) Qoo10 Pte Ltd along with the full stock merger deal, to keep the company (ShopClues) afloat. Qoo10 has a strong presence in the Southeast Asia market, and their acquisition of ShopClues in India also in line with its proposed IPO plans, as it looks to grow its market base, as well as the seller base," said an investor in ShopClues asking not to be named.
A person aware of the deal, requesting anonymity, said that ShopClues was valued much lower than the $200-250 million which was pegged when ShopClues had explored a merger with rival online retailer Snapdeal early this year. However, a TechCrunch report pegs the valuation of ShopClues at $70-100 million in the current merger deal.
A press statement from ShopClues said that Qoo10 is an e-commerce platform in Southeast Asia that services small and medium enterprises (SMEs) via its localised online marketplaces in Singapore, Indonesia, Malaysia, China, and Hong Kong.
The merger has been approved by the board of directors and major shareholders of both companies, the statement said, adding that this partnership opens up cross-border opportunities for consumers and sellers across Asia.
Founded in 2011, the Gurugram-headquartered ShopClues joined the billion-dollar club in January 2016, when it raised a round of funding led by sovereign wealth fund GIC Pte Ltd, along with participation from existing investors Tiger Global and Nexus Venture Partners.
Clues Network Private Ltd, that owns ShopClues posted losses of Rs208 crore for the year ended March 2018 and Rs347 crore in FY 2017.
In May this year, Snapdeal is believed to have carried out due diligence for a potential acquisition of ShopClues. However, the deal did not go through. Two months later, ShopClues reportedly laid off around 150-200 employees, across various departments.
Naren Gupta, co-founder and managing director of Nexus Venture Partners, in a recent interview to Mint in Bengaluru, said that ShopClues had not performed as expected and was "looking at various options right now, in terms of what it should do next".
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