San Jose-based e-commerce giant eBay, through its annual report filed with the US Securities and Exchange Commission (SEC) has disclosed a loss of $61 million from its investment in Japser Infotech-run Snapdeal.
eBay who sold its India operation to home-grown e-commerce major Flipkart, said that the company had started selling part of its stake in Snapdeal in 2016.
Importantly, this is the second write down for Snapdeal, SoftBank had written down the value of its portfolio companies Snapdeal and Ola by $1.4 billion in May last year.
Flipkart and Snapdeal were in talks for a potential merger. However, the deal couldn’t be materialised and Snapdeal decided to pull out of the deal to pursue an independent path to continue its operations. It also said that the company has a new and compelling direction – Snapdeal 2.0.
Since the merger efforts failed, Flipkart bought eBay India and acquired 5.4 per cent stake in the US-based company. The development occurred after eBay sold its Indian business to Flipkart for $211 million and made an additional $514 million investment into Flipkart.
With this move, Flipkart got access to eBay’s global customers and vice-versa.
Meanwhile, the Kunal Bahl-led company had registered a whopping revenue fall of 38 per cent in FY17 as compared to the previous fiscal. The company had clocked a consolidated revenue of Rs 904 crore from Rs 1,457 crore FY16.
Recently, it sold out logistics and supply chain management arm Vulcan Express to Future Supply Chain Solutions.
Besides, the firm is planning to sell its SaaS-based warehouse management platform Unicommerce eSolutions. It’s reportedly said to be in talks with Amazon and California-based business and financial software company Intuit.
Japan’s tech titan SoftBank preferred Flipkart over Snapdeal while making the largest bet ever in the history of India e-commerce. The Masayoshi son-led SoftBank Vision Fund had pumped in $2.6 billion for buying primary as well as secondary shares.
The development was first reported by TOI.