Japan's SoftBank investing $627m in Indian online giant Snapdeal
The deal is expected to be completed by the end of November.
TOKYO (AFP) - SoftBank said Tuesday it would invest $627 million in Snapdeal, becoming the largest shareholder in India s leading online marketplace as the Japanese mobile carrier strengthens its presence in the fast-growing market.
The deal was expected to be completed by the end of November, said a SoftBank spokeswoman in Tokyo.
"With this investment, the SoftBank group will become Snapdeal s largest shareholder," she said, without disclosing further details.
Snapdeal is India s fastest-growing and largest e-commerce website, with more than 25 million registered users and over 50,000 business sellers.
The New Delhi-based company, which has annual sales of $1.0 billion, has raised $350 million since its founding in 2010.
But after the latest round of funding from SoftBank and others, Snapdeal s valuation will rise to an estimated $2.0 billion with SoftBank as the single largest investor.
"Snapdeal is thrilled and honoured to have SoftBank as a strategic partner," co-founder and chief executive Kunal Bahl said in a statement.
"We are confident we will further strengthen our promise to consumers and create life-changing experiences for one million small businesses in India."
Other investors in Snapdeal, which is backed by eBay, include Indian tycoon Ratan Tata, Singapore state-owned investment company Temasek and asset management firm BlackRock.
SoftBank, which made headlines last year after its more than $21 billion takeover of US wireless giant Sprint, said the Snapdeal acquisition was aimed at boosting its presence in the booming Indian online market.
"We believe that India is at a turning point in its development and have confidence that India will grow strongly over the next decade," SoftBank chairman Masayoshi Son said in a statement.
"As part of this belief, we intend to deploy significant capital in India over the next few years to support development of the market," he added.
Son met India s Telecoms and IT Minister Ravi Shankar Prasad during a visit to New Delhi on Monday, as well as Prime Minister Narendra Modi.
India s online retail industry, valued at $1.0 billion just two years ago, is expected to hit $32 billion in sales in 2020, according to retail consultancy Technopak.
Separately, SoftBank also said Tuesday it would jointly invest $210 million in India s ANI Technologies, better known as Ola Cabs, which provides a marketplace connecting consumers and taxi drivers through mobile apps, the web and call centres.
"Ola s current shareholders will join the investment but SoftBank will take the lead," another SoftBank spokeswoman said, without elaborating.
SoftBank is a holding company that boasts more than 1,300 subsidiaries and affiliates involved in a range of mobile communications, fixed-line communications and Internet services.
It holds about one-third of Chinese online giant Alibaba and has said it would probably book a gain of about $4.6 billion from the firm s initial public offering, which raised a record $25 billion last month.
