SoftBank Invests Generously In India’s Internet Sector
India is indeed becoming a lucrative destination for foreign investors, who are leaving no stones unturned to ride on to this opportunity. Japanese investor SoftBank Corp., known for its extremely lucrative Alibaba investment - the Chinese e-commerce powerhouse that sold shares in a blockbuster initial public offering in September, has recently announced significant investments in Internet companies in India, worth a combined total of more than $800 million.
A chunk of its investment goes to Indian e-commerce major, Snapdeal, which is around $627 million. The Internet investment arm headed by former Google executive Nikesh Arora is bullish on India’s billion dollar internet opportunity where it sees huge untapped potential.
With this funding, Softbank is now the leading investor in Snapdeal.com. This is the largest investment made by a single investor in an e-commerce company in India. Through this strategic investment and partnership with Snapdeal, the SoftBank Group aims to further strengthen its presence in India and leverage synergies with its network of Internet companies around the world.
“Though development of the Internet in India has lagged behind China and other Asian countries, “we believe India is at a turning point in its development and have confidence that India will grow strongly over the next decade,” said Masayoshi Son, Chief Executive of SoftBank, in a statement.
Son says the company believes India is at a turning point in its development and have confidence that India will grow strongly over the next decade. As part of this belief, we intend to deploy significant capital in India over the next few years to support development of the market.”
Kunal Bahl, Co-founder and CEO of Snapdeal, says with this tremendous support, from SoftBank, we are confident we will further strengthen our promise to consumers and create life changing experiences for 1 million small businesses in India.
Snapdeal, which was founded in 2010, witnessed phenomenal growth in 2013-14, growing 600 per cent from 2013 to 2014. As one of the largest online marketplace in India, it has over 25 million registered users and 50,000 vendors using its site. This year alone, it has raised up to $1 billion from institutional investors - Temasek, Myriad, Tybourne, Blackrock Inc. and Premji Invest. Ratan Tata, Chairman Emeritus, Tata Sons, also made a personal investment into the company.
In order to further the tremendous growth Snapdeal.com has seen so far, the company will be making strategic investments in ramping up its efforts in technology and supply chain management, it said in a statement.
A Business Line report states that Snapdeal.com will also look to make 3-4 strategic acquisitions in the coming few months specifically in the area of mobile technology, which includes an incubation centre to harness start-up businesses in the mobile technology space.
SoftBank will also invest $210 million into Ola Cabs, which operates a digital taxi-hailing service that resembles Uber of US. Ola Cabs, owned by ANI Technologies was founded in 2011 and provides taxi services via 33,000 vehicles in 19 cities in India.
According to a source in the company, Softbank plans to “deploy significant capital” in India’s technology sector over the next few years.
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