Snapdeal.com, one of India’s largest e-commerce companies, said Wednesday that it has bought mobile-payments company FreeCharge, for an undisclosed amount.
New Delhi-based Snapdeal is a brand controlled by Jasper Infotech Pvt. which has Japan’s SoftBank Corp. and eBay Inc. as investors. It has about 40 million users and 100,000 merchants selling everything from cellphones to cars on its site. Snapdeal Considers Acquisitions in India, CEO Says It hopes the acquisition of FreeCharge will give it an edge in the battle with its competitors in India, Flipkart Internet Pvt. and Amazon.com Inc. The deal will help Snapdeal “offer all our customers access to the widest selection of products and services online,” Kunal Bahl co-founder and chief executive of Snapdeal said in a statement.
The company wouldn't disclose details of the transaction but one person familiar with the deal said the acquisition cost $450 million paid through a mix of cash and equity.
Mumbai-based FreeCharge is controlled by Accelyst Solutions Pvt. and is backed by U.S.-based venture firm Sequoia Capital, Belgium’s Sofina SA and others. FreeCharge has more than 20 million users who use the site to top up their mobile-phone accounts and pay utility bills. More than 85% of the FreeCharge’s transactions come through mobile phones. Roughly half of its customers have their credit-card details stored on the site which makes them particularly attractive as potential customers for Snapdeal.
The acquisition comes as Internet usage is rising in India. Asia’s third-largest economy had more than 300 million Internet users at the end of last year. That number is set to double in the next five years with the rise in the use of smartphones.
Snapdeal has been on an acquisition spree. In December, it bought a gift recommendation site Wishpicker.com and in February, it bought an online luxury fashion site Exclusively.com. Last month, it bought a majority stake in digital financial-products distribution company RupeePower. It didn’t disclose the prices of any of these purchases.
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