Future Group Acquires Snapdeal's Logistics Arm For ₹35 Crore

Kishore Biyani's Future Group's Supply Chain Solutions today said it will fully acquire Snapdeal's logistics service provider Vulcan Express Pvt Ltd in an all-cash deal valued at Rs 35 crore, reported Business Line.

With this acquisition, Future Group plans to boost its last mile capabilities and also offer modern solutions to its e-commerce and retail clients.

The acquisition deal happened in less than a month after Snapdeal infused fresh funds of ₹27 crore into Vulcan Express. Earlier in this month only, we reported about the possibilities of this acquisition.

Snapdeal Chief Strategy and Investment Officer Jason Kothari said, "Similar to our recent sale of FreeCharge, we believe Snapdeal's sale of Vulcan Express to Future Group is a successful deal for all three parties."

"Company divests off an asset that is non-strategic in nature for Snapdeal 2.0, allowing it to focus its capital and management on its core e-commerce business; Future Group gains high-quality pan-India end-to-end e-commerce logistics capabilities, and Vulcan secures a great new home for its business, including its team.", added Kothari in an official statement.

In an internal mail to employees, Vulcan Express CEO Hardeep Singh said, "This association is being recognised to be one of the most significant developments in the logistics industry in India... Vulcan's capabilities will be of big value to Future Supply Chain in enhancing its footprint and services".

Earlier in July 2017, it was reported that for sale of Vulcan Express Snapdeal was in talks with a few contenders including Gati, the express distribution and supply chain company, considered one of the largest in the country, and TVS Logistics. But it did not materialise into a firm deal.

Formed in 2014, Vulcan Express used to manage about half of Snapdeal's deliveries and shipments, replacing gojavas as the primary logistics partner, when about three years ago Snapdeal abandoned its plan to acquire Gojavas.

Future Group has been on an acquisition spree in the recent past. In April 2016, Future Group had also acquired Fabfurnish, an online furniture retailer, in an all-cash deal, followed by acquisition of Shoppers' Stop for Rs 655 crore.

Future Group Acquires Snapdeal's Logistics Arm For ₹35 Crore

Kishore Biyani's Future Group's Supply Chain Solutions today said it will fully acquire Snapdeal's logistics service provider Vulcan Express Pvt Ltd in an all-cash deal valued at Rs 35 crore, reported Business Line.

With this acquisition, Future Group plans to boost its last mile capabilities and also offer modern solutions to its e-commerce and retail clients.

The acquisition deal happened in less than a month after Snapdeal infused fresh funds of ₹27 crore into Vulcan Express. Earlier in this month only, we reported about the possibilities of this acquisition.

Snapdeal Chief Strategy and Investment Officer Jason Kothari said, "Similar to our recent sale of FreeCharge, we believe Snapdeal's sale of Vulcan Express to Future Group is a successful deal for all three parties."

"Company divests off an asset that is non-strategic in nature for Snapdeal 2.0, allowing it to focus its capital and management on its core e-commerce business; Future Group gains high-quality pan-India end-to-end e-commerce logistics capabilities, and Vulcan secures a great new home for its business, including its team.", added Kothari in an official statement.

In an internal mail to employees, Vulcan Express CEO Hardeep Singh said, "This association is being recognised to be one of the most significant developments in the logistics industry in India... Vulcan's capabilities will be of big value to Future Supply Chain in enhancing its footprint and services".

Earlier in July 2017, it was reported that for sale of Vulcan Express Snapdeal was in talks with a few contenders including Gati, the express distribution and supply chain company, considered one of the largest in the country, and TVS Logistics. But it did not materialise into a firm deal.

Formed in 2014, Vulcan Express used to manage about half of Snapdeal's deliveries and shipments, replacing gojavas as the primary logistics partner, when about three years ago Snapdeal abandoned its plan to acquire Gojavas.

Future Group has been on an acquisition spree in the recent past. In April 2016, Future Group had also acquired Fabfurnish, an online furniture retailer, in an all-cash deal, followed by acquisition of Shoppers' Stop for Rs 655 crore.

Future Group May Buy Snapdeal's Logistics Arm For ₹50 Crore

Within a week after Snapdeal infused fresh funds of ₹27 crore into Vulcan Express, its logistics arm, here comes the news that Future Group, India's larest retailer is in talks to buy Vulcan for about ₹50 crore in an all-cash deal.

Earlier in July 2017, it was reported that for sale of Vulcan Express Snapdeal was in talks with a few contenders including Gati, the express distribution and supply chain company, considered one of the largest in the country, and TVS Logistics. But it did not materialise into a firm deal.

With Vulcan purchase, Future Group wants to boost its strategy of integrating the retail company's digital and brick-and mortar retail businesses.

Formed in 2014, Vulcan Express manages about half of Snapdeal's deliveries and shipments, replacing gojavas as the primary logistics partner, when about three years ago Snapdeal abandoned its plan to acquire Gojavas.

Elaborating the purchase deal, the ET report said, "It will be a distress sale and the final valuation could be less than Rs 50 crore. The contours of the deal, including the size and through which company it will be done, are still being worked out."

It is also said that even if Snapdeal sell out Vulcan to whom so ever, the logistics company will continue to be the shipping and delivery partner of e-commerce firm.

Kishore Biyani-owned Future Supply Chain, on other hand, has raised Rs 650 crore by listing on the stock exchanges, a couple of weeks ago. The decade-old company caters to clients across consumer, food and beverages, ecommerce and electronics and gets about 63% of its revenue from group entities. At present, Future Group's technology integration, internally called Retail 3.0, is being piloted by making several Easyday stores a marketplace, giving consumers access to the company's entire inventory through the digital medium.

In April 2016, Future Group had also acquired Fabfurnish, an online furniture retailer, in an all-cash deal. The company however failing to run the purchased business and now its been reported that Kishore Biyani will shut down the Fabfurnish business.

Snapdeal Pumps in ₹27 Crore Into Its Logistics Arm Vulcan Express

The troubled e-commerce startup Snapdeal has again injected fresh funds worth ₹27 crore into its logistics arm Vulcan express.

The filings with the Registrar of Companies said Snapdeal has allotted 2.7 crore shares worth ₹27 crore to Vulcan Express. For 2015-16, Vulcan Express has posted losses of about ₹20 crore on revenues of around ₹185 crore.

This is the third time since June, Snapdeal has pumped in funds into the company.

In June, Snapdeal invested ₹36.5 crore into Vulcan and then came its biggest investment of ₹152.44 crore, in September this year.

Notably, Snapdeal is trying to sell Vulcan Express since it was in talks for possible merger with Flipkart early this year which eventually failed. For 2015-16, Vulcan Express has posted losses of about ₹20 crore on revenues of around ₹185 crore.

In July, it was reported that for sale of Vulcan Express the company was in talks with a few contenders including Gati, the express distribution and supply chain company, considered one of the largest in the country, and TVS Logistics. But it did not materialise into a firm deal.

Vulcan Express was formed in 2014 after Snapdeal abandoned its plans to acquire GoJavas, another logistics company in which it had invested about ₹250 crore and owned over 40% stake.

Reportedly, Vulcan Express operates in over 100 cities and over 50 per cent of the deliveries of Snapdeal is carried out by the logistics subsidiary.

To recall, the already troubled Snapdeal got more pressure when it received jaw-dropped Rs 300-crore legal notice from GoJavas' parent company Quickdel Logistics, in October this year.

Snapdeal Pumps in ₹27 Crore Into Its Logistics Arm Vulcan Express

The troubled e-commerce startup Snapdeal has again injected fresh funds worth ₹27 crore into its logistics arm Vulcan express.

The filings with the Registrar of Companies said Snapdeal has allotted 2.7 crore shares worth ₹27 crore to Vulcan Express. For 2015-16, Vulcan Express has posted losses of about ₹20 crore on revenues of around ₹185 crore.

This is the third time since June, Snapdeal has pumped in funds into the company.

In June, Snapdeal invested ₹36.5 crore into Vulcan and then came its biggest investment of ₹152.44 crore, in September this year.

Notably, Snapdeal is trying to sell Vulcan Express since it was in talks for possible merger with Flipkart early this year which eventually failed. For 2015-16, Vulcan Express has posted losses of about ₹20 crore on revenues of around ₹185 crore.

In July, it was reported that for sale of Vulcan Express the company was in talks with a few contenders including Gati, the express distribution and supply chain company, considered one of the largest in the country, and TVS Logistics. But it did not materialise into a firm deal.

Vulcan Express was formed in 2014 after Snapdeal abandoned its plans to acquire GoJavas, another logistics company in which it had invested about ₹250 crore and owned over 40% stake.

Reportedly, Vulcan Express operates in over 100 cities and over 50 per cent of the deliveries of Snapdeal is carried out by the logistics subsidiary.

To recall, the already troubled Snapdeal got more pressure when it received jaw-dropped Rs 300-crore legal notice from GoJavas' parent company Quickdel Logistics, in October this year.

Homegrown E-commerce Giant Snapdeal Infuse $23.7 Mn Into Vulcan Express

In July 2017, IndianWeb2 reported that the logistics arm of online marketplace Snapdeal’s Vulcan Express is soon going to acquired by express distribution and supply-chain companies, Gati, Peepul Capital and TVS Logistics.

With this acquisition, Snapdeal looks to gain about Rs 100-120 crore from the sale of its logistics unit, Vulcan Express. There are no buyers yet. And given Snapdeal’s knack of dilly-dallying, that could take longer as well.

But now, here comes the another development from the e-commerce major. According to filings with the Registrar of Companies, the Vulcan Express has received $23.7 million) from its parent, Snapdeal.

According to Vccircle report, the company raised the sum by allocating 15.24 crore equity shares at Rs 10 apiece to Jasper Infotech Pvt. Ltd, which operates Snapdeal, on 7 August.

The new funding round comes even as Snapdeal is reportedly trying sell off Vulcan Express.

In early August, it had come to light that Snapdeal was looking at a price tag of Rs 200 crore for Vulcan. A sale was expected to happen in 30-40 days. However, there no response has been received on the same.

According to industry experts, the current infuse into Vulcan possibly means a sale may not happen anytime soon. It also indicates Snapdeal’s intent to reconsider its original objective of building a profitable business in Vulcan.

Vulcan Express was the result of Snapdeal’s decision to build its own logistics arm, after its moves to acquire GoJavas did not materialize. Snapdeal, which had acquired a 42% stake in GoJavas in 2015, pulled out its business after instances of large-scale financial irregularities. GoJavas was later acquired by Pigeon Express.

In FY16, Vulcan Express posted a huge jump in net revenue to Rs 184 crore, up from Rs 26.7 crore in FY15. However, losses also widened six-fold to Rs 20 crore from Rs 3.2 crore in FY15. The company is yet to file its financials for FY17.

As part of the Snapdeal 2.0 strategy, which the e-tailer charted after its merger talks with Flipkart hit a dead end, It is looking to pivot to a pure play marketplace model. It will lay off a chunk of its workforce in the process. Shedding off its associated entities FreeCharge, Unicommerce and Vulcan was also reportedly part of the strategy.

Snapdeal is technically the first Unicorpse Startup of India as the troubled start saw its valuation falling down from $6.5 billion to less than $1 billion in a year or so.

Snapdeal now has cash reserves of Rs 385 crore ($60 million) from Axis Bank to which it sold its payments unit, FreeCharge.

Notably, a number of mistakes founders of Snapdeal had made can possibly make them the ‘Yahoo’ of India as by rejecting the $900 million merger offer from Flipkart can cost them a more setback in terms of valuation in future. But with this infuse, it looks like that e-commerce major is trying to rework on its mistakes.

10 Startup News That Made Buzz In The Week Gone By [10 - 15 July]

Missed the happening of startup world? Here is the recap for you. Mentioned below are the 10 news which made buzz during in the week gone by.

Bengaluru Based Gaming Startup IONA Entertainment Bags Investment From Chris Gayle

West Indies cricketer, Chris Gayle has invested an undisclosed amount in IONA Entertainment, a Bengaluru-based gaming startup. founded in 2016 by TS Subramanian and Preetha, IONA is a one-stop entertainment to Indian sports fans, which includes state-of-the-art virtual gaming. The startup had earlier raised an initial round of funding from Singapore-based Vestasia. For Gayle, India is his top priority in terms of investment destinations and wanted to invest as many businesses as possible.

Google Launches New Startup Programmes; Selects 11 Women Led Startups For Launchpad’s Build

The tech giant. Google has recently announced the expansion of its startup accelerator project Launchpad, bringing three other programmes under its umbrella — Start, Build and Scale. Under this initiative, Google India recently hosted a Developers’ Launchpad Build event in Bengaluru where they shortlisted and provided guidance to 11 women-led startups in Bengaluru. According to the Google Launchpad’s Event website, with this edition of Launchpad, they want to support women entrepreneurs from startups across various stages.

Delhi-based Startup Builds A Touch Screen Mirror With Wi-Fi Connectivity

Delhi-based startup Help Me Build Technologies Pvt Ltd. has developed an innovative touch screen smart mirror called  ‘Nuovo, that can do anything and everything with Wi-Fi connectivity and android phone. Nuovo ‘Smart Mirror’ can keep you updated with notifications from social sites like Facebook and Twitter. You can get the latest news from the leading publications, can also access YouTube videos, and even book cab through Uber. With the help of this, the user can control which app to be displayed on the mirror for easy access.

Finally, It's Official, PayTM Acquires OML’s Insider.in

The digital payment startup PayTM has acquired a majority stake in Insider.in, a ticketing platform. According to the sources, this deal is done for about 35 crores. Shreyas Srinivasan, Insider.in founder will continue running the business, while Only Much Louder (OML) founders and brothers Vijay and Ajay Nair will remain stakeholders and members of the advisory board. This acquisition will enable hundreds of millions of PayTM customers to discover a wide selection of events and book instantly.

Earlier owned by OML, Insider.in is one of the leading ticketing platforms in India for events and properties including for events and properties, including NH7 Weekender, EDC and The Grub Fest.

StartUp India Report: After 18 Months Only 39 Startups Qualified for Tax Benefit

According to a report by The Hindu, till March 2017, only around 10 Indian startups have been able to pass the eligibility for tax benefits. This takes the total number of startups actually benefitting from the programme to 39 since its launch 18 months ago in January  2016. In recently, concluded the budget session, Finance Minister Arun Jaitley had announced alteration in the government’s policy on tax concessions for startups and said that only the firms incorporated on or after April 1, 2016, could now avail a three-year tax holiday in the first seven years of their existence.

According to experts, only a few startups have been able to pass the tax benefit eligibility criteria because not many corporate entities have been incorporated on or after that stringing cut-off date that the government has decided upon.

Google Acquires Indian Startup Halli Labs

Google’s growing interest in Indian startup ecosystem can be witnessed by this. Recently, tech giant acquired Halli Labs, an Indian startup working on solutions based on artificial intelligence and machine learning. Based out of Bengaluru, Startup has been founded just four-months back by former Stayzilla employees. Over the past one year, Google has announced several services to better serve the untapped Indian market. The startup announced the news by a post on Medium, and Caesar Sengupta, a product management VP at Google, also confirmed the acquisition with a Tweet.

Early Stage Startup Funding Shrinks Sharply In 2017

This news comes as a major concern for Indian Startup ecosystem. According to the reports, the base of the startup funding pyramid is shrinking and this could severely impact the growth of startup ecosystem in India. According to the figures stated by Tracxn the number of angel and seed investments made in the first half of 2017 (January to June) is down to 260, indicating a drastic drop from 419 in the first half of 2016. Whereas, Seed funding has seen a steep decline from 278 to 152. The report further states, the total funding in 2017 at $5.1 billion is more than double that in 2016, at $2 billion and ecosystem get this number because of the two big funding rounds of $1.4 billion each in Flipkart and Paytm.

Startup Tools Launched By Microsoft

Microsoft recently unveiled three new tools that would help small businesses and startups to grow at a rapid pace. The three new tools: Microsoft Connections, Microsoft Listings and Microsoft Invoicing will be a great addition to the company’s existing rack of tools like the Outlook Customer Manager and Microsoft Bookings. The main idea behind launching the three tools is to make Microsoft users more involved in its Office 365 ecosystem. In order to make it available to people, the company has decided to make the tools available free of cost through Microsoft’s Office 365 First Release program.

Acquisition Talk: Snapdeal’s Logistic Arm Vulcan To Be Acquired By Gati, TVS

The logistics arm of online marketplace Snapdeal, Vulcan Express in talks with express distribution and supply-chain companies, Gati, Peepul Capital and TVS Logistics for its acquisition. The companies have shown their interest to acquire Vulcan Express. From this acquisition, Snapdeal is expecting Vulcan Express to fetch Rs 90-120 crore, which could take place over the next 60 days.

Sachin Tendulkar Backed Smarton To Acquire New IoT Startups

Smartron is planning to spend Rs 300 crore for acquiring new companies to complete IoT play in India. According to the company’s top executive, Smartron will spend money towards acquisition of new firms in the area of healthcare, smart homes, energy and infrastructure. The startup is taking this step to broaden its IoT product portfolio in India. Founded in 2004 by Mahesh Lingareddy, the company further plans to invest Rs 1,500 crore over the next three years towards setting up R&D, engineering, manufacturing and data centre facilities.

The company had earlier acquired Volta Motors, a Chennai-based automotive player that manufactures electric vehicles.

Other Important News

Apart from these startups news, there were other important headlines which grabbed the eyeballs of the readers. The parent company of Google and several former Google subsidiaries, Alphabet has officially launched a new firm, Gradient Ventures within Google that will invest in early-stage AI startups.

Recently, iKeva had launched 2 new centres – 175 seats secured co-working space in Sector 44, Gurugram’s Premium location and another 165 seaters in Mumbai.

Apart from these two, another news which made the buzz was iVOOMi, Chinese electronic major announcing its strategic alliance with the e-commerce giant Flipkart, to capitalize on latter’s Market Intelligence support, in order to extensively penetrate into Tier – 2,3 & 4 cities in India.

Snapdeal’s Logistic Arm Vulcan Might Get Acquired By Gati, TVS

Here comes the another news from Snapdeal House. If sources to be believed, the logistics arm of online marketplace Snapdeal’s Vulcan Express is soon going to acquired. According to ET, express distribution and supply-chain companies, Gati, Peepul Capital and TVS Logistics have shown their interest to acquire Vulcan Express.

The report further state that Snapdeal is expecting Vulcan Express to fetch Rs 90-120 crore from the acquisition which could take place over the next 60 days.

If everything goes well, this sale will provide much-needed capital relief to Snapdeal owners while they continue to negotiate its own sale to rival e-commerce company Flipkart.

Jason Kothari, chief strategy and investment officer at Snapdeal is spearheading the transaction on behalf of the online marketplace, with Alvarez and Marsal advising the company. If sources to be believed, the potential acquisition of Vulcan Express may be routed by Warburg Pincus, a global private equity major through one of its portfolio companies in India.

Homegrown e-commerce giant, Flipkart, which recently offered $800-900 million for Snapdeal, an offer that was rejected by the compnay board last week, is also expected to separately bid for the logistics unit. However, the Bengaluru-headquartered domestic online retail giant is expected to come back with a revised offer for Snapdeal, close the transaction first, before it begins negotiations for Vulcan Express.

This also comes after Axis Bank has emerged as one of the frontrunners to acquire the digital payments platform owned by Snapdeal, FreeCharge.