Economy

Flipkart raises $2.5 billion from SoftBank's Vision Fund

Flipkart raises $2.5 billion from SoftBank's Vision Fund

This investment is an extension of Flipkart's funding round in April this year, when Tencent, ebay and Microsoft invested in the company.

"The funding round further solidifies Flipkart's balance sheet and will help accelerate investment in driving continued market leadership", it said. He also hinted that going forward there could be chances of Flipkart and Paytm, in which Softbank pumped in $1.4 billion this year, coming together as they have several synergies and use that to fight Amazon in India.

The deal comes just 10 days after SoftBank's attempts to forge a deal between Flipkart and smaller rival Snapdeal - and thwart Amazon's ambitions in India - fell apart following months of negotiations. The battle for India's e-commerce market is set to get hot - Flipkart is the top online retailer in India, but Amazon India has commitments of around $5bn from its U.S. parent to expand its market share there. Estimates suggest that the company has already invested over Dollars 2 billion in the last few quarters in the Indian market. The deal was reportedly backed by SoftBank, which is the largest investor in Snapdeal.

"SoftBank's proven track record of partnering with transformative technology leaders has earned it the reputation of being a visionary investor".

"This is the biggest ever private investment in an Indian technology company and will make the Vision Fund one of the largest shareholders in Flipkart", Flipkart said in a statement.

Flipkart has raised over ₹16000 crores from Softbank in form of primary and secondary capital.

"India is a land of vast opportunity", said Masayoshi Son, Founder, Chairman, and CEO of SoftBank Group.

Another leading investor Ravi Gururaj was of the view that the recent funding has just made things hard for the other global players such as Rakuten, Walmart and Alibaba to make a roadway in the Indian e-commerce market.

Over the past year, analysts in the market were feeling that Flipkart had run out of steam due to lack of funds from its investors. "We want to support innovative companies that are clear winners in India".

Binny Bansal and Sachin Bansal, Co-Founders of Flipkart, said in a statement: "This is a monumental deal for Flipkart and India". With this massive infusion, Softbank has become one of Flipkart's largest shareholders. The talks collapsed at the end of July, but multiple reports suggested SoftBank would participate in Flipkart's next funding round.


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