Japanese investment giant SoftBank has reached out to other shareholders of India’s largest e-commerce marketplace Flipkart
with a proposal to buy their stock at a valuation of around $9-10 billion.
The move is part of Softbank’s August commitment to pick up additional stake in Flipkart
through secondary transactions, giving some investors the option to exit the company either fully or partially.
Out of the total $2.5 billion investment commitment, SoftBank will use around $1.2-1.4 billion in buying out shares of other investors. It is expected that Tiger Global, one of the largest shareholders in Flipkart
will sell a substantial portion of its stock to SoftBank, giving it a partial exit. The Mint
newspaper reported this first on Thursday.
With both primary and secondary transactions combined, SoftBank’s shareholding
could be between 18-20 per cent, giving it significant say on the company’s board. The other big power block on Flipkart’s board is the Tencent-Naspers
duo- both of whom remain committed to the company.
Naspers, in its half-yearly financial report on Wednesday, said that it had invested a further $71 million in Flipkart
in April. The company reported that its shareholding
in the company dropped to 13 per cent after the two subsequent funding rounds that happened later in the reporting period.
Tiger Global, which has been one of the most prolific venture capital investors in India, is looking at brokering exits from some of its most successful bets here. Business Standard
reported last week that SoftBank looking to pick up a 10-12 per cent stake in Ola for around $400-500 million, largely by buying out shares of Tiger Global.
SoftBank, with the backing of its $100-billion Vision Fund, is committed to taking long-term bets on e-commerce and ride-hailing companies
globally, and India
is a key focus area.
The Japanese investment firm has said that the valuation of its shareholding
in all its Indian investments
amounts to $6 billion, making it the largest venture capital investor in the country.