SoftBank’s latest investment in Jasper Infotech might bring its valuation down to half
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Also read: Nirmala Sitharaman to investigate Snapdeal’s payment defaults
If the transaction takes place, SnapDeal would become the latest top-tier Indian Internet company to cut down its valuation, after cab aggregator Ola and Zomato.
In its last funding round led by Canada's Ontario Teachers' Pension Plan in February 2016, Jasper was valued at $6.5 billion. However, in late 2014 to early 2015, it was valued below $3 billion because of stake sales by shareholders to other investors.
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"Regardless of valuation, the fact that money is available is a good sign," said Harish HV, partner, India Leadership team, Grant Thornton India. "It means investors, whether new or existing, haven't yet given up on the company and that there is meat left. It's a sign of bullishness."
As per reports, this fresh funding would come with stricter rules regarding financial control.
"Earlier cheques were written after SnapDeal submitted annual operating plans. Now Soft-Bank will ask for SnapDeal's monthly budgets, approve them, and then remit the funds," said one of the aforementioned sources.
In the recent past, SnapDeal, India’s third largest online marketplace after Flipkart and Amazon India, has seen little growth and has been marred by losses, and tremors in upper management.
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Also read: Snapdeal founders admit to 'wrong moves', take 100% salary cut(Image source: SatyaVijayi)
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