Flipkart said on Thursday that SoftBank's Vision Fund, the world's largest technology-focused fund, has invested in the Bengaluru-based e-commerce company to become one of its largest shareholders.
Without disclosing the amount invested, the company said: "This is the biggest ever private investment in an Indian technology company."
In a statement, it said: "The investment is part of the previously announced financing round, where Flipkart had raised capital from three of the world's premier technology companies - Tencent, eBay and Microsoft.
"After this financing round, Flipkart will have in excess of $4 billion of cash on balance sheet", Flipkart's blog post regarding the deal said.
Co-Founders Sachin and Binny Bansal added, "This is a monumental deal for Flipkart and India... We're excited to welcome the Vision Fund as a long-term partner as we continue to build our business with a focus on serving the needs of all Indians, and driving the next phase of technology adoption in India."
Flipkart's poster announcing the fundraise
Just a few weeks back, Flipkart and its smaller rival Snapdeal had called off merger talks that would have resulted in Softbank obtaining a stake in the former. The Japanese tech and telecommunications giant is already a stakeholder in New Delhi-based Snapdeal and also owns a hefty stake in Chinese behemoth Alibaba. Softbank's founder and CEO Masayoshi Son had recently said he respects Snapdeal's founders for calling off their talks with Flipkart, but had hinted that he would persist with obtaining a stake regardless.
Upon obtaining the stake, Son said, "India is a land of vast opportunities. We want to support innovative companies that are clear winners in India because they are best positioned to leverage technology and help people lead better lives. As the pioneers in Indian e-commerce, Flipkart is doing that every day"
To become the "biggest ever private investment in an Indian technology company", Softbank's would have needed to invest well over a billion dollars into Flipkart. Seeing as how the Vision Fund is planned as being in excess of $100 billion, this may not have been outside the realm of possibility. At the very least, Softbank would have had to exceed the $1.4 billion it invested into Paytm in May, then thought to be the biggest investment in an Indian tech company.
(With PTI input)