Consolidation seems to be the talk of the startup town these days. After proposing to sell Snapdeal to Flipkart, now SoftBank-backed FreeCharge is reportedly in talks with Gurugram-based mobile wallet company MobiKwik for a potential merger.
As per a report by Business Standard, FreeCharge is planning to merge with MobiKwik in an all-stock deal. The report further states that the newly combined entity is likely to receive an investment of around $200 Mn from a Chinese investor as well.
It further added that, both MobiKwik and FreeCharge are valued at around $300 Mn each and the merged entity would be marked somewhere around $700 Mn-$1 Bn.
Ecommerce marketplace Snapdeal’s digital payments subsidiary Freecharge has been up for sale for sometime now. Earlier in April 2017, reports surfaced that, in an attempt to cut down on mounting losses, Japanese investor SoftBank was trying to sell the entity for around $150 Mn-$200 Mn – on a 50% valuation markdown compared to the $450 Mn that Snapdeal infused in the company in April 2015, during acquisition.
There were also reports of Paytm acquiring FreeCharge, with an aim to dominate the Indian digital payments space.
Earlier, in December 2016, reports surfaced that global payments platform Paypal had also placed a bid to acquire 25% stake in FreeCharge at a $200 Mn valuation. However, FreeCharge refuted these reports and denied any such possibility.