By Yash Saxena

Jasper Infotech, the parent company of Snapdeal, has begun talks with various stakeholders to sell off its software-as-a-service (SaaS) based warehouse management company Unicommerce eSolutions. This might as well turn out to be the last major sellout of an asset by the company in an effort to raise cash for operations. The main contenders in this important deal are e-commerce giant Amazon and United States (US)-based business and financial software company Intuit, which is also a NASDAQ listed entity. The officials of both these companies declined to give any details regarding this selloff as the talks are still in the nature of speculation.

The birth and peak of Unicommerce eSolutions

Unicommerce eSolutions is an acquired business of Jasper Infotech. It was founded in 2012 by the alumni of the Indian Institute of Technology, Delhi (IIT-D) Ankit Pruthi, Karun Singla and Vibhu Garg. Manish Gupta joined them as a co-founder in the year 2013. Jasper Infotech acquired this company in a cash-and-stock deal in 2015 for about $40 million. In August 2017, the founding team of Unicommerce eSolutions quit according to the terms of this acquisition following the end of the stipulated period. According to its report, Unicommerce eSolutions processes nearly 100 million orders every year and has more than 10,000 sellers on its list of clients. This includes many e-commerce companies such as Amazon, Jabong, Flipkart and eBay and also brick-and-mortar retailers such as Ritu Kumar, Raymond and Puma.

A recent wave of selling non-core assets

The talk of this sale comes days after Snapdeal sold off its logistics arm Vulcan Express to the Future Group led by Kishore Biyani for Rs 35 crore. It must also be noted that Snapdeal sold its digital payments platform Freecharge to Axis Bank for Rs. 385 crore. Lately, Snapdeal has been selling off its non-core assets at a steady pace in pursuance of its Snapdeal 2.0 strategy which was formulated after the sale of Snapdeal to Flipkart, managed by SoftBank, failed. It has also been adopting various cost-cutting measures to boost its profit. This is being done in a concerted effort to reinstate Snapdeal to the position of a standalone e-commerce marketplace. Jasper Infotech has given an enterprise valuation of Rs 150 crore to Rs 200 crore to Unicommerce eSolutions for this deal.

A beneficial proposition for Amazon

This acquisition could fit well into the expansion strategy of both the contenders, namely Amazon and Intuit. Amazon has long been involved in a high-stakes battle with Flipkart to acquire the top spot in India’s fastest growing e-commerce sector. This has resulted in Amazon investing a huge amount of capital to boost its infrastructural capabilities. The acquisition of Unicommerce eSolutions could bolster this effort by providing an excellent and readymade platform to manage warehousing. Further, the already widespread client base of Unicommerce eSolutions could add to Amazon’s expansion efforts and give it access to important players in the market thus strengthening its back-end infrastructure improvement efforts. At the same time, this acquisition makes strategic sense for Intuit which could help it ramp up its operations across the globe, including India.

Word from the corporate grapevine

At the time when the founding team of Unicommerce eSolutions quit as mentioned above, industry observers had predicted that there were chances of Snapdeal selling off its warehousing arm. However, this was dismissed by the then Chief Executive Officer of Unicommerce eSolutions, Kapil Makhija, who said that the operations of the company were financially healthy and there were no plans for any sale. He further said that the company was instead looking to expand its reach and initiate business in some international markets. With the talks of selling of Unicommerce eSolutions by its parent Jasper Infotech doing the rounds in the corporate grapevine, the prediction of the industry experts seems to be true.

Featured Image Credits: jonrussell on VisualHunt / CC BY

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