SoftBank Vision Fund invests $2-2.5 bn in Flipkart



Khaitan & Co Bangalore partner Ganesh Prasad with associate partner Vinay Joy, principal associate Arun Scaria and senior associate Sanjay Khan represented Indian Singapore-headquartered e-commerce Flipkart on the $2.5bn investment.

Image: Sachin Bansal and Binny Bansal/ Getty Images Online marketplace Flipkart has bagged about $2.5 billion in fresh funds from the SoftBank Vision Fund in the largest-ever capital infusion in the domestic consumer Internet space, a move that will give significant financial heft to the ecommerce firm to battle Amazon.

The investment caps a months-long saga involving SoftBank trying to acquire an interest in Flipkart, originally by trying to orchestrate a merger with Snapdeal.

The investment is part of the previous financing round in April, when Flipkart raised $1.4 billion from Tencent Holdings, eBay and Microsoft, the Indian company said.

SoftBank was supposed to invest $1.52 billion in the proposed merged Snapdeal-Flipkart entity, but after the talks fell through, SoftBank chairman Masayoshi Son said that he respects the decision of the founders and chose to focus the fund's effort in Flipkart.

"The Vision Fund is proud to be part of this landmark transaction which is a strong endorsement of India and its thriving economy", added Rajeev Misra, CEO of the SoftBank Vision Fund. We want to support new and creative companies that are positioned at the top in India which help people to lead better lives, and Flipkart is doing it every day. Softbank's write-off on Snapdeal was bigger than its original cumulative investments worth $900 million so far in just over two-and-a-half years. They are continuing their marketing leadership. Softbank has invested funds in Flipkart, even as its efforts to merge rival Snapdeal into India's leading e-commerce players fell through on disagreement over valuations.

SoftBank in May had said the fund will target "meaningful, long-term" investments in companies that seek to enable the next age of innovation. Till date, Flipkart has raised about $4.6 Bn funding in 14 rounds, excluding the current round. The investment comes after Snapdeal cancelled the acquisition deal with Flipkart.

"This is a monumental deal for Flipkart".

Apart from this the funding raised by SoftBank also emerges as a masterstroke by Flipkart.

Citi served as financial advisor and AZB and Partners served as legal advisor to the SoftBank Vision Fund.

Gunderson Dettmer New York partner Steven Baglio was worldwide counsel for Flipkart.

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