BigBasket, the domestic hyperlocal online grocery chain, is in demand these days. The startup was earlier in discussion with Amazon for an outright acquisition or stake sale. Once those talks didn’t materialize, it started holding fundraising talks with Singapore’s sovereign wealth fund Temasek Holdings and China’s Fosun Group as well. Now, parallelly, the Alibaba-Paytm Mall combine has offered to invest $200 million in BigBasket at a valuation of nearly $900 million post the investment. It has already started the due diligence of the online grocer. The valuation offered by Alibaba is double of what the company was estimated last year when it raised funds.
The investment makes sense for PayTM as its founder, Vijay Shekhar Sharma, said that investing in an e-grocer will help in providing further push to the company’s online-to-offline strategy. Paytm Mall, which was spun out from parent One97 Communications this year to an entity called Paytm Ecommerce, received an infusion of $200 million in March from Alibaba and SAIF Partners. Along with the above options, BigBasket is also exploring merger with its smaller counterpart Grofers. Morgan Stanley is advising BigBasket on the financial discussions with all parties.