Axis Bank has announced on Thursday that they are set to buy digital wallet FreeCharge from Snapdeal for $60 million strengthening its position in the payments space. The transaction is expected to conclude by the end of September.
Despite the late bidding of $70-80 million from Amazon, Snapdeal went ahead with the Axis Bank deal as they dont want to initiate the time-consuming process of due diligence with Amazon again.
This acquisition will give Axis Bank access to FreeCharges 54-million-plus customers, technology, human resources and the branding advantage that comes with an early mover.
The Axis Bank and FreeCharge combination is an essential one that has the potential to make a large impact on the digital payments and banking space. It is a win-win deal that allows Snapdeal to further focus on our e-commerce business while giving Axis some of the agilest and innovative technology capabilities in the financial space in India, said Snapdeal co-founder Kunal Bahl on the acquisition.
This acquisition of FreeCharge aims at marrying the ability of a fin-tech company with the strength of a bank to provide a uniquely distinctive user experience, said Shikha Sharma, CEO of Axis Bank.
With this acquisition, Snapdeal will get just a fraction of $400 million it paid in order to acquire FreeCharge in 2015, which was one of the biggest start-up deals, as per the reports from Livemint.