Retail

Snapdeal Attempts To Calm Employees As Takeover Rumors Swirl

As the takeover rumors concerning Indian online retailer Snapdeal continue, the company recently made an effort to address the speculations with employees.

According to Reuters, the company sent an email to its employees confirming that there will be no disruption to staff “as the way forward becomes clear.” The email, which was seen by Reuters, confirmed that a sale of the company may be in the cards, but that the priority will remain on ensuring the well-being of employees.

“We will do all that we can, and more, in working with our investors to ensure there is no disruption in employment and that there are positive professional as well as financial outcomes for the team as the way forward becomes clear,” Snapdeal’s founders Kunal Bahl and Rohit Bansal communicated in the message.

Just last week, Snapdeal CFO Anup Vikal told Reuters that the company is now seeking to raise some $100 million in additional funds from new and existing investors, with the hope to boost Snapdeal’s cash reserves and maintain its course to become profitable in two years.

In February, Snapdeal restructured by laying off between 500 to 600 employees and making cuts to its online payments division FreeCharge as well as its logistics operation Vulcan Express.

For some time now, despite the increasing speculation, Snapdeal continued to deny it was for sale.

Reports in the month of March suggested that the company was in sale discussions with domestic rivals Paytm E-Commerce and Flipkart, but Snapdeal denied that sale discussions took place.

“Snapdeal has been desperately looking to raise money in China for the last few months,” a source claiming direct knowledge of Snapdeal’s plans told Reuters. “It had multiple rounds of talks with some Chinese funds and was also hoping to get some fresh money from Alibaba. But those talks were not going anywhere, and Alibaba made it clear to them they would not write a new check for them given the dim outlook for making money any time soon.”

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