India’s largest Internet firm Flipkart Ltd has raised a fresh round of capital from SoftBank Vision Fund—$2.5 billion, three people said—increasing the company’s cash reserves to more than $4 billion, which will help in its battle against arch-rival Amazon India.
Flipkart didn’t disclose the amount but said that the SoftBank investment comprises a mix of primary (investment in the company) and secondary capital (purchase of shares from existing shareholders).
The three people, who asked not to be identified, said the investment was at least $2.5 billion.
Mint had reported earlier that SoftBank would invest more than $1.5 billion in Flipkart by putting in fresh capital and buying shares from Tiger Global Management, Flipkart’s largest shareholder.
The SoftBank investment, which has been reported by Mint and other publications for months, comes after Flipkart’s proposed takeover of Snapdeal, SoftBank’s portfolio company, collapsed last week.
“This is a monumental deal for Flipkart and India. Very few economies globally attract such overwhelming interest from top-tier investors. It is recognition of India’s unparalleled potential to become a leader in technology and e-commerce on a massive scale. SoftBank’s proven track record of partnering with transformative technology leaders has earned it the reputation of being a visionary investor,” Flipkart co-founders Binny Bansal and Sachin Bansal said in a joint statement.
Flipkart said the SoftBank investment, which is the biggest-ever private investment in an Indian technology company, will make the Vision Fund one of the largest shareholders in the online retailer.
The investment is part of the latest financing round into Flipkart, which had raised $1.4 billion from Tencent, eBay and Microsoft in April.
“We want to support innovative companies that are clear winners in India because they are best positioned to leverage technology and help people lead better lives. As the pioneers in Indian e-commerce, Flipkart is doing that every day,” said Masayoshi Son, chairman and CEO of SoftBank Group Corp.
The investment will likely make SoftBank the largest investor in Flipkart.