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India’s homegrown e-commerce giant Flipkart is reportedly planning for a fresh acquisition drive. However, this acquisition drive may be different from the earlier ones, since this time the e-commerce giant is not eyeing stakes merely in upcoming and promising startups. Rather it has diverted focus on big and well known startups.
Some media houses have got sniff from top sources that Flipkart is looking to pick up stakes in famed startups like food-deliver company Swiggy, service firm UrbanClap and online ticketing platform Bookmyshow. Flipkart’s aggressive acquisition strategy is clearly reflected in the latest regulatory filings.
As per the filings with the corporate affairs ministry last month, it significantly raised reserves for financing acquisition to Rs8,000 crore from previous levels of Rs3,000 crore. Reports from sources also suggest that Flipkart is also focusing on buying stakes in Fintech start-ups.
The homegrown online shopping giant’s largest acquisition deal till date has been Myntra, wherein it invested more than $330 million in May 2014. Besides, the company has invested in roughly 20 more startups, with several companies evidently being acquired to enhance operational efficiency.
Earlier this year, the Bengaluru based giant also made a bold move to acquire its competitor Snapdeal. However, the much anticipated deal collapsed following the disagreement over valuation.
Latest acquisition drive fuelled by recent funding round
Clearly, Flipkart’s latest acquisition drive is been fuelled by recent huge funding rounds. This year it has raised nearly $3 billion from big names like SoftBank, eBay and Microsoft. The funding has swelled company’s cash reserves to over $4 billion, offering it the much needed financial muscle to compete against arch rival Amazon.
Analysts claim that Flipkart’s latest acquisition drive to acquire big startups is driven by the need to attain financial invincible position. They say that this is critical for the company to outmaneuver the deep pocketed Amazon from the Indian e-commerce market.
