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SoftBank pushes funds in Flipkart

With the announcement of its $2.5 billion investment in Flipkart earlier this week, SoftBank Group has begun to stitch together an iron curtain against Jeff Bezos’ Amazon. The investment in India’s top ecommerce company was put together at a lightning speed by the Tokyo-based technology-to-telecom conglomerate, barely two weeks after it failed to push through a sale of its portfolio company Snapdeal to Flipkart. It is being seen as a strategy to not only capture significant stakes in India’s largest Internet companies, but also take Amazon head on in the world fastest growing digital economy. SoftBank has already committed more than $4 billion to India’s startup ecosystem in 2017, doubling what it had invested in the country since 2014. Having invested in Paytm, Flipkart, Ola and Hike Messenger, it now has stakes spread across the payments, ecommerce, ride-sharing and social messenger segments. But it is the investments in Paytm and Flipkart, announced within three months of each other in 2017, that potentially give SoftBank the strongest ammunition to take on the American online giant. “I don’t think anybody is going to be able to kill Amazon. Amazon is here to stay. It’s a question of finding the right players to take on Amazon, in the right categories, in the respective countries as well,“ said Vinod Murali, managing partner of venture debt firm Alteria Capital Advisors. The latest investment, which will see Flipkart’s cash reserves cross $4 billion, will allow the Bengaluru-headquartered online retail firm to create a deeper moat as it continues to stave off stiff competition from Amazon, which has also pulled out all stops to grab the pole position in India’s discount-fuelled, highly attritional ecommerce industry. Bezos has pledged to continue ploughing capital into its Indian unit, which has made significant gains over the past four years in Asia’s third-largest economy.

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