Japanese telecom and media group SoftBank will invest a total of $627 million in Indian online retailer Snapdeal for a 30-per cent stake, making it the single-largest investment in an e-commerce company.
Following the investment, SoftBank will also become the largest shareholder in Snapdeal.
Softbank is making the investment through its group company SoftBank Internet and Media (SIMI.
Delhi-based Snapdeal, was founded in 2010 by entrepreneurs Kunal Bahl and Rohit Bansal, as a daily deals platform modelled after Groupon.com, and by September 2011 had expanded into an e-commerce company via a marketplace model like its larger rival Flipkart.
It claims over 25 million registered users and more than 50,000 business sellers.
SoftBank said in a statement, through this investment in Snapdeal the group aims to strengthen its presence in India and leverage synergies with its network of internet companies around the world.
Snapdeal launched its mobile app for iOS users this month, which is available for Windows and Android users, to access Snapdeal's various product categories.
''We believe India is at a turning point in its development and have confidence that India will grow strongly over the next decade. As part of this belief, we intend to deploy significant capital in India over the next few years to support development of the market,'' said Masayoshi Son, Chairman and CEO of SoftBank Corp.
Following the investment, Nikesh Arora, vice chairman of SoftBankCorp and CEO of SIMI will join Snapdeal's board.
Morrison & Foerster was the legal adviser to SoftBank, while Kochhar & Co advised SoftBank on Indian law matters.
''India has the third-largest Internet user base in the world, but a relatively small online market currently. This situation means India has, with better, faster and cheaper Internet access, a big growth potential. With today's announcement SoftBank is contributing to the development of the infrastructure for the digital future of India,'' Arora said.
''We want to support the leaders and entrepreneurs of the digital future,'' he added.
Snapdeal.com has raised close to $1 billion this calendar year from global investors. The company's marquee investors include BlackRock, Temasek, eBay, Premji Invest, Intel Capital, Bessemer Venture Partners and Ratan Tata among others.
Certain other existing investors also participated in this round, but their details were not disclosed.
Snapdeal, has received five rounds of funding, so far. In February this year, it raised $133.77 million from a round led by eBay and later in May raised $105 million from institutional investors (Temasek, Myriad, Tybourne, Blackrock Inc. and Premji Invest).
Ratan Tata, Chairman Emeritus, Tata Sons, has also made a personal investment into the company (See: Ratan Tata invests in Snapdeal as Tata Value ties up online home sales).
Snapdeal will make investments in ramping up its efforts in technology and supply chain management. The Snapdeal, which opened its second innovation centre in Bangalore, plans to centres in Hyderabad and Pune. It will also double its technology team to 1,000 by the end of the current financial year.
The company also looks to expand its fulfilment centres to 30 cities, from the present 15, and aims to expand its merchant base to 1 million in the next three years.
Further, Snapdeal hopes to make three - four strategic acquisitions in the coming few months specifically in the area of mobile technology.
With mobile commerce fast gaining pace in the country, within the next six months Snapdeal will also set up an incubation centre to hone and harness start-up businesses in the mobile technology space.