Axis Bank wins the race to acquire Freecharge

Axis Bank, India’s third largest private sector lender, has been cleared by the board of Jasper Infotech (parent of Snapdeal) to acquire its payments jewel Freecharge. The deal will value the payments arm at INR390 crore, a far shy from the INR2,400 crore which Snapdeal paid to acquire the startup in 2015, which was also touted as the biggest acquisition in the Indian startup environment. The conclusion of the deal marks a closure to a two-year long process during which Gurgaon-based Jasper Infotech–which also owns and operates beleaguered online marketplace Snapdeal—has also sought to raise fresh funding for the payments provider that competes with market leader Paytm.

Incidentally, Axis Bank wasn’t sole bidder for the startup. Freecharge was in talks with several players such as PayTm, Kotak Mahindra Bank, Amazon and others for the potential acquisition. However, the deal didn’t go through with them earlier. The sale of Freecharge, once described as “Snapdeal’s crown jewel” by CEO Kunal Bahl, will provide much needed capital relief to the beleaguered company, potentially giving it operational liquidity for a few additional months. It is yet not clear if the startup’s leadership team also join Axis Bank or leave the firm in pursuit of greener pastures elsewhere.