Snapdeal to raise Rs 2,000 crore funds for FreeCharge

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Jasper Infotech that operates Snapdeal, the online marketplace is in discussions with the existing as well as new investors in order to raise around $300 million worth funds. This funding is for FreeCharge, its digital services platform, claims a couple of people with knowledge about the development.

The fundraising practice has come within three months after which the firm raised around $500 million from SoftBank, Foxconn and Alibaba. This funding is aimed to strengthen FreeCharge and the ability of Snapdeal to provide a range of goods and services to the customers.

Accelyst Solutions, the parent of FreeCharge was acquired by Jasper in April this year for a deal of $450 million. This acquisition is considered the biggest transaction to have taken place involving the Indian startups. Following the same, SoftBank and Foxconn started discussing with Jasper.

Apart from these companies, two sovereign funds are also likely to take part in the funding round. This reflects that the country’s digital goods as well as services are attractive enough to garner the attention of investors.

An investment meant only for FreeCharge will deviate from the previous rounds of fundraising that were meant to fund the overall growth. The rival of Snapdeal that is Flipkart has raised a fund of $3.4 billion till date and it has not taken part in any fundraising for a sole unit.

The funding for FreeCharge is expected to help the online marketplace surpass Paytm that has managed to raise around $680 million from the Chinese marketplace Alibaba and its affiliates. FreeCharge was founded by Kunal Shah along with Sandeep Tandon in 2010. In September, it also launched its digital wallet after partnering with Yes Bank. The proceeds from the proposed funding round will be utilized to expand the whole range of offerings. It is alleged that Alibaba will not participate in the funding meant for FreeCharge.

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