Flipkart could be weeks away from
concluding a deal to buy rival Myntra as the two sides engage in last-minute
haggling over valuation before concluding what will be the biggest transaction
in India's online retail industry.
People with knowledge of the talks said
fashion portal Myntra is aiming for a valuation of $400 million (Rs 2,400
crore). The company, based in Bangalore, is founded by Mukesh Bansal, 38, an IIT-Kanpur
graduate. But Flipkart, also based in Bangalore and co-founded by 32-year-old
IIT-Delhi alumnus Sachin Bansal (the two Bansals are not related), may not be
willing to concede that much.
Negotiators are considering a "target
valuation" of $350 million, and may push the offer to $370 million , but
there is "no possibility" of valuing Myntra at $400 million,
according to a source with direct knowledge of talks. Representatives of
Flipkart and Myntra declined to comment.The deal is being stitched during a
period of frenetic activity in the ecommerce space.
Amazon, the world's largest online
retailer, is steadily building out its India operation -- it will start selling
fashion items in the next few weeks -- while the country adds hundreds of thousands
of new online shoppers every month.
The timing of the transaction also takes
into account an initial public offering of Flipkart's shares next year, most
probably on the Nasdaq stock exchange in the United States, sources said.
Flipkart , which raised $360 million in two rounds in 2013, was valued at
around $1.6 billion in July last year. The valuation is "significantly
more" now, the sources said without disclosing how much.
Comments
Post a Comment