Snapdeal held a board meeting on Tuesday, 2 May’2017 where founders Kunal Bahl and Rohit Bansal gave their nod to the deal and agreed to the compensation terms.
Snapdeal’s board meeting on Tuesday to discuss the final contours of the sale to e-commerce rival Flipkart proved to be inconclusive, with early investor Nexus Venture Partners continuing to offer stiff resistance.
Nexus is now seeking a higher stake in the merged entity. The investor had earlier wanted a complete exit by selling its 11 percent stake to SoftBank, which owns Jasper Infotech that operates Snapdeal.
However, one of Snapdeal’s earliest investors, Kalaari Capital, gave its in-principle nod for the Flipkart deal on Tuesday. Kalaari, which holds an 8 percent stake in Snapdeal, had reached an informal consensus earlier.
Sources told CNBC-TV18 that Snapdeal founders Kunal Bahl and Rohit Bansal were also convinced of the merits of the deal after Tuesday’s meeting and agreed to the compensation terms.
Moneycontrol had on April 20 reported that Bahl and Bansal had agreed upon the final contours of a proposal to sell Snapdeal to Flipkart.
The Snapdeal board will now need to meet again to formally vote on a resolution for the deal, which requires the go-ahead from at least two majority investors.
The Flipkart board is also set to meet to explore the feasibility of the deal.
Snapdeal is currently considering multiple options. Besides having conversations to sell Snapdeal, the company is also in independent talks to sell Snapdeal’s logistics arm Vulcan Express with TVS Logistics and Future Supply Chain Solutions. Snapdeal is also looking for potential buyers for payments arm FreeCharge.
Snapdeal is currently valued at USD 1 billion, much lower than its peak of USD 6.5 billion a few years ago.