Former ecommerce unicorn ShopClues announced its merger with Singapore headquartered ecommerce platform Qoo10 in an all stock deal. The acquisition will enable Qoo10 to expand its presence in the Indian market as a cross-border ecommerce platform.
Backed by Singapore Press Holdings, eBay, Saban Capital Group and others, Qoo10 has a presence across Indonesia, Malaysia, China and HongKong and plans to expand to other Asian countries. The logistics arm of Qoo10 raised $50 million in June this year from Crescendo Equity Partners, while the entire ecommerce business has raised close to $230 million since it was founded in 2010.
“This partnership presents new strategic opportunities for both companies, as it opens up cross border opportunities for consumers and sellers across Asia,” said a statement issued by the two companies on Thursday.
The statement further added that the merger has been approved by the board of directors and major shareholders of both companies. The management and branding of ShopClues will remain unchanged and its 350-odd employees will become part of the new entity.
While the financial details of the transaction were not disclosed, The Economic Times, citing sources, said the deal valued ShopClues at close to $70 million. Email queries to ShopClues CEO Sanjay Sethi did not elicit responses at the time of publishing this report.
ShopClues, which was valued at over $1 billion in 2016 after an investment by Singapore’s sovereign wealth fund GIC, was in talks with SoftBank-backed Snapdeal for an acquisition as debts piled up. The former struggled to attract investors as common investor Nexus Venture Partners tried brokering a deal with Snapdeal in order to create an exit earlier this year. However, the talks fell through as the two Delhi-based companies could not reach an agreement on the valuation.
Founded in 2010 by former Wall Street analyst Sandeep Aggarwal, Radhika Ghai and former eBay executive Sanjay Sethi, ShopClues was thrown a lifeline by existing investors with a $16 million infusion in August 2018, and has had to let go off 50% of its employees over the year as it ran out of cash. Ghai took over as chief business officer at ShopClues early on as Sandeep Aggarwal moved on to set up Droom.
Focused on the non-metro buyers, ShopClues claims a merchant base of 7 lakh and had made multiple acquisitions including payments company Momoe in 2016.