Snapdeal buys Freecharge in mobile transactions push – Exclusive Snapdeal News

Snapdeal-Freecharge---YourStory

Snapdeal buys Freecharge in mobile transactions push – Exclusive Snapdeal News

BENGALURU/MUMBAI (Reuters) – E-retailer Snapdeal.com said on Wednesday it bought online mobile recharge firm Freecharge for an undisclosed amount in a bid to boost its reach in the fast-growing mobile transactions business.

Snapdeal, backed by SoftBank Corp, competes with Flipkart and Amazon.com Inc’s India unit in the country’s online shopping market, which is expected to be worth $102 billion by 2020, according to Morgan Stanley.

Easy availability of smartphones and cheap data plans have resulted in most of those transactions to be made via apps, where consumers use their mobile phones for everything from buying clothes to booking movie tickets.

Freecharge allows users to top up amounts on their mobile phone or internet connections and get coupons as reward for using its service.

Snapdeal Chief Executive Kunal Bahl said 1 million mobile transactions would take place daily once the companies are combined. About 75 percent of all Snapdeal transactions now are through mobile users, he said.

Freecharge would remain an independent platform even after the deal, which is expected to close within the next 6 months, Bahl said, without specifying how much much it paid to buy the mobile recharge firm.

With the acquisition, Snapdeal would become “the largest mobile commerce company in India,” the company said in a statement.

(Reporting by Devika Krishna Kumar in BENGALURU, Nivedita Bhattacharjee in MUMBAI; Editing by Biju Dwarakanath)

1. With this acquisition, Snapdeal claims to be the largest mobile commerce company in India.

2. FreeCharge will continue to function as an independent platform and all aspects of FreeCharge’s shopping experience will remain intact.

3. It’s a cash plus stock deal with the majority of it in stocks and only a small part in cash.

4. Integration will take almost six months.

5. The 200 employees of FreeCharge continue with the company which will now witness some aggressive hiring.

6. At the time of the deal, FreeCharge had more than $80 million in its bank accounts.

6. Snapdeal and FreeCharge combined together have a user base of over 40 million and a total of 30 million app downloads (FreeCharge 10 million) on play store.

7. Both the platforms combined together witness >1 million transactions daily.

8. Snapdeal now has seven major subsidiaries – Snapdeal, Exclusively.in, RupeePower, TV-Shop, Snapdeal Plus, Gojavas and FreeCharge.

9. While Snapdeal receives over 70% of its orders from tier-2 cities and beyond, FreeCharge receives less than 30% orders from these geographies.

10. This could be one of the biggest M&A in the Indian internet ecosystem.

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