Global Fashion Group (GFG) which operates fashion retail site Jabong in India, is in talks with mobile payments and commerce company One97 among other eCommerce sites to sell off the online property. The deal amount is expected to be between $500-$800 million.
Sources familiar with the discussion told publication Livemint, that Rocket Internet and Kinnevik owned GFG wants to sell off stake in the ‘money-losing Indian fashion store’ before the group goes public.
The talks are being led by AB Kinnevik’s investment manager, Akhil Chainwala who is currently in India to meet Paytm founder Vijay Shekhar Sharma and top executives of the Aditya Birla Group, as per sources familiar with the matter.
The site started operations in January 2012. It was co-founded by Arun Chandra Mohan, Praveen Sinha, and Lakshmi Potluri after which Manu Jain, and Mukul Bafana joined the organization.
This year, Jabong was merged with Global Fashion Group (GFG). Currently, Jabong offers 190,000 products from more than 1,800 brands. It is under pressure to from its parent company for the losses and has been asked to cut down the expenses.
Jabong has recently shut its design office in London and has also fired 10-15 people from the London team, under pressure from the parent company. Earlier this year, the company had also announced its plans to launch firm’s first technology lab in Bangalore.
It had raised $100 Mn funding round and since January 2015, investors have pumped in over $45 Mn (INR 300 Cr.) in the company, according to the documents filed with the Registrar of Companies.
GFG was founded in 2011 by Rocket Internet and Kinnevik, with a focus on emerging markets, including India, SEA, Latin America, Middle East and Russia.
In November 2014, Amazon India held talks with Jabong for a potential buyout, however, the deal fell through at the beginning of 2015 after Jabong asked for a $1.2 billion valuation.
Jabong sells shoes, apparel, accessories, home décor and furniture through its website. The e-store at present carries over 1000 brands and over 90,000 products.
Few days back, it was reported that Jabong was looking for a new CEO. According to a report, current CEO and co-founder, Arun Chandra Mohan and Managing Director and co-founder, Praveen Sinha were moving out of the company.