Kalaari Capital may offload its stake in Snapdeal for Rs 50 crore

Kalaari selling its stake for Rs 50 crore signals a massive haircut for a holding, which was worth over Rs 3,000 crore when the company was valued at $6.5 billion.
Kalaari Capital may offload its stake in Snapdeal for Rs 50 crore
Kalaari Capital may offload its stake in Snapdeal for Rs 50 crore
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Kalaari Capital, one of the key early stage investors in ecommerce startup Snapdeal, is mulling offloading of its sizeable holding in the company. Though there is no official confirmation of the proposed move, it is likely that Kalaari may even completely opt out of the startup, though there is a possibility the offloading of shares could be a partial exercise, according to an Economic Times report.

The reports also indicate that this sell-off could happen in favour of the promoters, Kunal Bahal and Rohit Bansal. The sources also indicate that these developments are still at a preliminary stage and may or may not lead to a fruition. The likely value of the sale is being projected at around Rs 40-50 crore.

Observers are of the opinion that if and when the promoters get hold of the equity held by Kalaari, they would end up tightening their grip on the company. They are currently said to be holding together around 7.3%, while Kalaari could be having about 8%. These developments are also seen as a fallout of the recent efforts made by SoftBank to sell Snapdeal to Flipkart. The efforts did not succeed and the promoters decided to stay strong and grow the company on their own strengths.

It is also rumored that besides the co-founders of Snapdeal, Kalaari could be talking to the other investors also to check if they would be interested in buying their shares.

There are even those who claim that the very reason for the Flipkart deal falling through was that Kalaari Capital and another early stage investor Nexus Venture Partners wanted a special payout of $90 million for lending their support to the merger proposal and that was not agreeable to the parties concerned.

The fact that Vani Kola, the MD of Kalaari Capital quit Snapdeal’s Board and had admitted that she was terribly disappointed at the 2 co-founders not going ahead with the proposal, may partially explain this as well. The overall deal was worth $850 million.

Meanwhile Kalaari Capital is on its way to raise its next investment vehicle and Snapdeal is charting a new course and business model to bring the operation back on track.

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