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Snapdeal Planning Up to 15% Pay Hike Amid Sell-off Buzz

E-commerce major Snapdeal will shell out an average pay hike of 12-15% as it looks to assure employees amid the online marketplace scouting for a potential buyer.

PTI

Updated:April 13, 2017, 9:05 AM IST
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Snapdeal Planning Up to 15% Pay Hike Amid Sell-off Buzz
E-commerce major Snapdeal will shell out an average pay hike of 12-15% as it looks to assure employees amid the online marketplace scouting for a potential buyer. (Photo: Reuters)
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E-commerce major Snapdeal will shell out an average pay hike of 12-15% as it looks to assure employees amid the online marketplace scouting for a potential buyer.

According to sources, the pay revision will be effective from April 1 and will see salaries of employees at the mid and junior-level go up by an average 12-15%.

For senior management, the hike will be 9-12%, but the company may offer 20-25% raise to exceptional performers, they added.

The cash-strapped company is also believed to be distributing nearly 1% of its stock to about 150 employees.

Earlier this year, the company's founders had admitted to have made mistakes and said they would take a "100%" in their own salaries.

The decision to give such a good pay hike has been taken at a time when Snapdeal's largest investor SoftBank is believed to be working towards sale of the e-commerce platform and a final decision is likely to be made in the next few weeks.

The top contender in the race is Flipkart, which has recently received a funding of $1.4 billion.
Softbank is also in talks with Kalaari Capital and Nexus Venture Partners, who have representation on the board of Snapdeal, to reach a consensus on valuation, sources said.

Snapdeal's seven-member board includes representation from investors SoftBank, Kalaari Capital and Nexus Venture Partners, as well as co-founders Kunal Bahl and Rohit Bansal.

The company has about 3,000 people in its e-commerce operations. The company also has mobile wallet (FreeCharge) and logistics (Vulcan) operations.

The sources said about 3,000 of Snapdeal's current and ex-employees hold 5-6% of the company stock in the form of Employee stock options ( ESOPs).

Speculations are rife that Alibaba-backed Paytm is also in the fray as a potential buyer. Alibaba is also a shareholder in Snapdeal.

So far, Snapdeal and SoftBank have not made any comment on the speculations of sale.

Snapdeal co-founders Kunal Bahl and Rohit Bansal, in a recent letter to employees, had indicated that the company's investors are "driving the discussions around the way forward".

If Snapdeal does get sold to Flipkart, it would mark the biggest acquisition in the Indian e-commerce space and change the landscape of the sector that is witnessing intense competition among players.

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