MUMBAI: Amid the Flipkart-Snapdeal merger saga, a new buyer emerged for one of Snapdeal’s components – FreeCharge. Private-sector Axis Bank is believed to have firmed up plans to acquire the digital payments platform FreeCharge at a knock-out price of roughly Rs 390 crore. Express couldn’t independently confirm the move.
Amazon and Times Internet were believed to be the other contenders. The proposed Axis-FreeCharge deal is expected to be announced as early as Thursday, according to reports.
It may be noted the Snapdeal’s parent firm Jasper Infotech acquired FreeCharge for over Rs 2,400 crore in 2015. The deal was touted as the Indian start-ups’ growing appetite to make it big.
However, FreeCharge could not keep pace with competition from home grown wallet providers like PayTM and MobiKwik and soon lost its spot as the second largest wallet firm in India.
According to estimates, it recorded a mere 12 million transactions in April, much lower than the industry average.
Axis Bank, the country’s third largest private lender, has been stepping up focus on digital solutions. FreeCharge is considered to be a strategic fit to Axis’ incoming digital play. The proposed deal also comes at a time when Axis Bank’s net profit has been sliding owing to rising NPAs. It is penetration into retail loans is also smaller than peers like ICICI and HDFC. Both these banks also have a stronger digital presence. Flipkart is also believed to have made a revised bid for Snapdeal estimated at $950 million.