Flipkart Group, India’s e-commerce marketplace, has raised a total of $1.4 billion from Tencent, eBay and Microsoft, three of the world's premier technology companies. This investment adds to an existing group of marquee investors that include Tiger Global Management, Naspers Group, Accel Partners and DST Global.
The latest funding round, at a post-transaction valuation of $11.6 billion, is the largest in Flipkart’s 10-year history as well as in the Indian internet sector and comes as Flipkart gears up to drive the next phase of e-commerce growth in India.
“This is a landmark deal for Flipkart and for India as it endorses our tech prowess, our innovative mindset and the potential we have to disrupt traditional markets. It is a resounding acknowledgement that the homegrown tech ecosystem is indeed thriving and succeeding in solving genuine problems in people’s daily lives across all of India," said Sachin Bansal and Binny Bansal, Founders of Flipkart.
Tencent joins as a strategic investor, bringing experience in linking social networking and e-commerce. As a leading provider of internet value-added services in China, Tencent has been at the center of innovation in social, payments and other areas.
“Flipkart is a leader in e-commerce in India, with strong operational expertise and a deep understanding of user behaviour. This strategic partnership enables Tencent to participate in the exciting opportunities in e-commerce and payments in India. We look forward to helping Flipkart to deliver compelling experiences to users throughout India, and to contribute to the development of the internet ecosystem there,” said Martin Lau, Tencent President.
The investment by eBay is accompanied by a strategic commercial agreement with Flipkart. In exchange for an equity stake in Flipkart, eBay is making a cash investment in and selling its eBay.in business to Flipkart. eBay.in will continue to operate as an independent entity, as a part of Flipkart. The two companies have also signed an exclusive cross-border trade agreement.
As a result of the partnership between Flipkart and eBay, customers of Flipkart will gain access to the wide array of global inventory on eBay, while eBay’s customers will have access to more unique Indian inventory provided by Flipkart sellers. More important, sellers on Flipkart will now have an opportunity to expand their sales globally, which Amazon.in has already established in India with its Global Seller Programme .
“The combination of eBay’s position as a leading global e-commerce company and Flipkart’s market stature will allow us to accelerate and maximize the opportunity for both companies in India,” said Devin Wenig, President and CEO of eBay Inc.
The Flipkart Group is India's largest e-commerce marketplace and includes group companies Flipkart, Myntra, Jabong and PhonePe. Launched in October 2007, Flipkart offers over 80 million products across 80+ categories. Together with Myntra and Jabong, which hold dominant positions in the online fashion market, and PhonePe, India’s first UPI based payment app with offerings in nine languages, the Flipkart Group has led the transformation of commerce in India.
Flipkart to buy eBay.in eBay Inc and Flipkart have agreed to jointly pursue eCommerce opportunities in the Indian market. In exchange for an equity stake in Flipkart, eBay will make a $500 million cash investment in and sell its eBay.in business to Flipkart. Flipkart will own and operate the eBay.in business upon the close of the transaction, expected later this year. Upon the close of the transaction, Flipkart will acquire eBay’s buyers in India. eBay will remove the number of active buyers in India (which is approximately 4 million) from its reporting during the quarter in which the transaction closes. eBay does not expect this transaction to have a material impact on its guidance provided on January 25, 2017. |