Infibeam to acquire Snapdeal's tech solutions arm Unicommerce
Infibeam Incorporation Ltd, the parent of the country's only listed e-commerce company, will acquire 100% stake in Unicommerce, the technology solutions arm of fellow e-tailer Snapdeal.
Ahmedabad-based Infibeam said in a statement that it had entered into an agreement with Snapdeal's parent, Jasper Infotech Pvt. Ltd, for the acquisition by issuing optionally convertible debentures on a preferential basis. The deal size could go up to Rs 120 crore.
“Through Unicommerce, we plan to boost our e-commerce enablement capabilities and expand the product offerings for existing clients," said Infibeam managing director Vishal Mehta.
Snapdeal has been looking to sell Unicommerce for some time now, and was said to be seeking looking for a Rs 150-200 crore valuation.
Unicommerce was founded in 2012 by IIT Delhi alumni Ankit Pruthi, Karun Singla and Vibhu Garg. Manish Gupta joined the venture as co-founder in 2013. The firm claims to have 10,000 registered vendors across more than 220 cities in India.
Its flagship product, Uniware, is a software-as-a-service (SaaS)-based application for end-to-end management of order fulfillment. The application helps manage vendors, procurement, inventory and warehouse.
In August last year, VCCircle reported that the founding team had quit, following the completion of the stipulated period as per the terms of the acquisition of Unicommerce by Snapdeal.
Snapdeal had acquired Unicommerce for an undisclosed amount in March 2015.
After the founding team resigned, industry observers had indicated that Snapdeal was likely to sell the unit.
Snapdeal has been hiving off its various acquisitions and divesting assets to cut costs even as the company is struggling to compete with other second tier e-commerce companies like ShopClues and Paytm Mall.
Since scrapping a planned merger with bigger rival Flipkart in July last year, it adopted what it called a ‘Snapdeal 2.0’ strategy in a bid to revive its fortunes.
“Selling Unicommerce to Infibeam is a continuation of the Snapdeal 2.0 plan to divest and focus on our core consumer e-commerce business," said Jason Kothari, Snapdeal's chief investment and strategy officer.
Earlier this year, Snapdeal sold logistics arm Vulcan Express Pvt. Ltd to Future Group for $5.5 million (Rs 35 crore) in cash.
Last July, it had sold its digital payments unit FreeCharge to Axis Bank.
A week ago, Snapdeal reported a drop in consolidated net sales for the first time in five years. The Delhi-based firm reported net sales of Rs 1,082 crore for the financial year 2016-17, down from Rs 1,211 crore in the previous fiscal.
The company's financials for 2017-18 will not be known until later this year.
Infibeam was founded in 2010 by former Amazon executive Vishal Mehta and operates a horizontal e-commerce platform. It was one of the youngest companies to list on the National Stock Exchange when it floated its initial public offering in March 2016.
In February, billionaire Mukesh Ambani-controlled TV18 Broadcast Ltd announced that it would invest up to Rs 40 crore ($6.23 million) in Infibeam.
The transaction appeared to be an ad-for-equity-style investment.
In February last year, Infibeam had acquired Avenues India, which runs payment gateway CC Avenue.
Infibeam MD Vishal Mehta said the acquisition of Unicommerce would also be pivotal for the growth of its GeM (Government e-Marketplace) business.