E-retailer Snapdeal said on Wednesday it bought online mobile recharge firm Freecharge for an undisclosed amount in a bid to boost its reach in the fast-growing mobile transactions business. Snapdeal, backed by SoftBank Corp, competes with Flipkart and Amazon India unit in the country’s online shopping market, which is expected to be worth $102 billion by 2020, according to Morgan Stanley.
The FreeCharge team will be kept on under FreeCharge co-founder and CEO Kunal Shah, the release stated. It will continue to function as an independent platform and all aspects of FreeCharge’s shopping experience will remain intact, the release stated.
FreeCharge + Snapdeal = Exciting Times Ahead : http://t.co/BE3hAQClyU
— FreeCharge (@FreeCharge) April 8, 2015
“FreeCharge is at the forefront of the mobile commerce revolution which is taking place in India right now,” said Shah. “We have been ahead of the curve and as a result, 85 percent of our transactions originate from mobile, these transactions have very high repeat customer behavior. The partnership with Snapdeal comes at the right time, I foresee this as an opportunity to accelerate our road map in India and reach out to millions of users across the country.”
Snapdeal raised about $1 billion last year while Flipkart raised nearly $2 billion. One of the major investments in Snapdeal came from Japan’s Softbank Corporation, which infused $627 million into the New Delhi-based company.