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The gunslinger, SoftBank is looking to protect two prominent Indian startups from going down under, has decided to first focus on the merger of the bigger and more important entity rather than lugging both of them together.

Citing anonymous sources aware of the development, a fresh FactorDaily report suggests that SoftBank is planning to move slow in the process of selling off Jasper Infotech — the parent of Snapdeal. The Japanese telecom giant is not planning to hastily hand over the e-commerce business, run under Snapdeal, to homegrown rival Flipkart and the payments business, run under FreeCharge, to its arch-nemesis Paytm.

Thus, it has decided to first divert attention towards the former transaction, which it wants to happen immediately, and placing the latter on hold for the moment. This means SoftBank is now gunning for a successful merger between the cash-deprived Snapdeal and Flipkart, who’s just topped up its coffers with a humongous $1.4 billion investment. Flipkart has recently also added another major e-commerce player, eBay India, to its arsenal.

As the reports of Flipkart-Snapdeal’s merger have emerged on the interwebs, the two tech giants are said to have signed a binding agreement for the same. The main proponent behind the transaction is SoftBank, who’s jumping back into India’s burgeoning startup ecosystem by first consolidating its existing but underperforming bets. It has spent the last couple of months solving the divide between itself and the early investors into the company — Nexus Venture Partners. and Kalaari Capital.

As suggested by one of the sources, SoftBank is extremely eager for the Snapdeal-Flipkart merger to come through instantly. This, the Japanese telecom giant believes, would provide the cash-starved e-commerce giant some respite from its present condition. The e-commerce giant is presently sustaining its momentum with $17.5 million emergency funds that have been invested into Snapdeal by Nexus Venture Partners and the company’s co-founders, namely Kunal Bahl and Rohit Bansal.

Snapdeal, for those aloof, has been stuck in this situation for quite some time now. It has already suffered at the hands of a shortage of cash, wherein it had to slash a majority of its workforce (about 600 employees) and the founder’s had to give up on their annual compensations. This has enabled the company to work out the quirks and extend their deadline for survival on existing capital.

Further, the report cites another source and mentions that SoftBank is planning to adopt this course of action because investment into Snapdeal will drive some much-needed capital towards FreeCharge as well. The second largest digital payments platform has also initiated talks about its acquisition by the leader of the said ecosystem — Paytm.

This is, however, not being considered a fair transaction because Paytm is planning to shell out close to $100 million-$150 million for acquisition of a majority 80 percent stake in the company. This means FreeCharge’s valuation has been driven way down due to intense competition, lagging technology, and cash deprivation. Snapdeal had acquired the payments major for close to $450 million, a figure which should give you a better understanding of the current scenario.

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