China’s Alibaba Group Holding will not be acquiring Indian e-tailing portal Snapdeal and as of now, there will be no talks regarding the matter. According to a Reuters report, a source said that deal has been called off even though there had been a lot of speculations around the acquisition. Chinese e-commerce giant Alibaba with an aim to make inroads into the Indian e-commerce market was earlier said to be in talks to buy the second-largest e-commerce firm in India after Flipkart, Snapdeal.
The failed talks indicate that world’s biggest online retailer Amazon will be getting too far ahead in the Indian market with its aggressive investments here, which is even causing trouble to the other Indian companies like Flipkart and Snapdeal. Earlier, there have been reports that Alibaba was also in talks with Flipkart with a chance of a potential buyout. But after the reports that Alibaba was interested in Snapdeal came out it was clear that the Flipkart deal did not work out.
When it comes to the Indian e-commerce market, Alibaba in September last year, acquired a 40 percent stake in Indian online payments company PayTm. Just like Alipay, PayTm also allows online buyers to shop without the need of using cash or cards. This will be highly useful, especially after PM Narendra Modi announced the policy of demonetisation of higher denomination currency notes.
Snapdeal reportedly has raised around $2 billion in funding in the last seven years. Recently it raised $21 million (around Rs 143 crore) from a Luxembourg-based investor called Clouse SA. Japan’s Softbank Group has the highest share in Snapdeal with 33 percent stake. Even Alibaba is said to have 2.93 percent share in the company.