India-based e-commerce company Snapdeal has received Rs1.13bn ($17.5m) in emergency funding from Nexus Venture Partners and the company’s founders, according to Mint.
The transaction comes ahead of an expected acquisition by Snapdeal’s rival Flipkart, for which a non-binding term sheet agreement was signed last week.
Snapdeal, which operates an e-commerce platform but has struggled to compete in a market now largely dominated by Flipkart and Amazon India, has raised some $1.7bn in capital from backers including telecoms firm SoftBank, e-commerce firms eBay and Alibaba, contract manufacturer Foxconn, chip maker Intel and mobile software provider Myriad.
The reason for Snapdeal’s latest funding round is not entirely clear, but may be related to its acquisition of software developer Unicommerce eSolutions, though that information has not been confirmed.
Snapdeal reportedly had cash reserves left for another four months at the end of April, so the money could also be a lifeline to keep Snapdeal going until it is acquired by Flipkart.