In an effort to push more money into its own India eCommerce site, eBay has sold part of its stake in the Indian eCommerce site Snapdeal, the company announced yesterday (Aug. 18).
In total, eBay had invested in multiple Snapdeal financing rounds, including one round that it led that totaled more than $133.7 million in 2014. While there were once rumors that eBay would buy Snapdeal, it’s clear that’s not happening. In fact, Snapdeal has grown quite a bit recently, and has been given a valuation as high as $5 billion. This is what likely led eBay to pull its money so it could invest elsewhere.
In an eBay blog post, the company explained the business decision, which included the announcement that it was selling a portion of its Snapdeal investment — but it did not specify how much. This move follows eBay’s most recent decision to sell off eBay Enterprise and eBay’s equity interest in Craigslist.
“Executing against our strategy includes regularly reviewing and actively managing our investment portfolio to ensure it fits within the broader strategic direction of eBay,” Scott Schenkel, eBay’s SVP and Chief Financial Officer, wrote in the post.
“Today we are taking another step to effectively manage our global interests and invest in other strategic initiatives, by announcing that eBay has sold a portion of our investment in Snapdeal, an India-based eCommerce company. Over the past two years, the valuation of Snapdeal has significantly increased, and because eBay was an early investor, this sale will enable us to earn a strong return on our invested capital and strategically redeploy it into other areas of our business.”
Schenkel noted that eBay was an important market for the eCommerce company and that the company is choosing to invest more in eBay.in, which is eBay’s India site that offers consumers more than 30 million items. In fact, he pointed out that it has become a shopping platform for 65,000 entrepreneurs and businesses in India.
“Going forward we will focus on accelerating eBay’s presence in India, and empowering customers through technology, as with our new #SheMeansBusiness program that encourages female entrepreneurs with online businesses to share their success stories and help other like-minded businesswomen,” Schenkel wrote.
The news that eBay is selling off part of its Snapdeal investment comes at the same time the $500 million financing round into the India eCommerce marketplace from Alibaba and Foxconn was officially announced. While the deal was just publicly confirmed, early reports about the investment surfaced in June.
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