Leading Global Internet and media conglomerate Naspers has invested an additional $71 Mn in Flipkart, taking its holdings in the company to 16.5 percent. According to the financial details filed by Naspers, the investment was made in April 2017 to buy the stake from the existing investors. However, it didn’t disclose the name of the seller.
Naspers first invested in Flipkart in 2012 in series D round of funding. Naspers was the lead investor at that time. Two years later, Naspers along with Tiger Global led a $1 billion investment into Flipkart during the series G Round in July 2014. But, Its stake got diluted in 2015 when it did not participate in a funding round for Flipkart.
“The group invested $71 Mn for an additional interest in its associate Flipkart Limited (Flipkart) in April 2017. The additional interest was acquired from existing shareholders of Flipkart. Following the investment, the group holds a 16% interest in Flipkart on a fully diluted basis,” stated Naspers, in an annual filing.
“The group’s Indian etail associate, Flipkart, remains a large opportunity, with market estimates expecting the online retail market in India to reach $50 Bn by 2020. Competition has intensified in the past year, with Amazon gaining market share in the early part of the year. Flipkart has maintained its leadership position, with recent market share trends suggesting gains,” said the company.
In the filing, Naspers also mentioned that the e-commerce company’s share in monthly GMV that fell to 45% in June 2016, increased to 55% in March 2017.
The company had witnessed a number of valuation markdown by the investors includes T Rowe Price, Fidelity, Valic and Morgan Stanley. However, post the appointment of Kalyan Krishnamurthy as a CEO, Flipkart has managed to gain its leadership position.
Earlier this year, Flipkart closed a $1.4 billion funding round, led by Tencent, eBay, and Microsoft at a post-transaction valuation of $11.6 billion. The round also saw the participation of its existing investors that include Tiger Global Management, Naspers Group, Accel Partners, and DST Global.
Besides the investment, Flipkart’s proposed acquisition of eBay India also received approval from the CCI and the company is also in talks to acquire its rival Snapdeal.
As far as Naspers in concerned, the company made its first foray into the foodtech sector in India by investing in online food delivery startup Swiggy’s $80 Mn Series E funding. Last year, Naspers executed two major consolidation plays in the digital space in India. In September 2016, PayU India acquired local startup Citrus Pay for $130 Mn. Then in October, the conglomerate sold ibibo Group to rival MakeMyTrip in a stock deal valued at $1.8 Bn.