NEW DELHI: Global Fashion Group (GFG) has decided to inject additional funds into its lossmaking fashion ecommerce company Jabong to keep it afloat for one more year, said two people familiar with the development.
"The board has agreed to put more than $20 million in Jabong," said a person who participated in the meeting held in Luxembourg recently. GFG, founded in 2011 by Swedish Investment AB Kinnevik and German Rocket Internet SE, operates ecommerce ventures Dafiti in Latin America, Lamoda in Russia and the CIS, Namshi in the Middle East, Zalora in Southeast Asia and Australia and Jabong in India.
While Oliver Samwer, CEO of Rocket Internet and deputy chairman at GFG, was said to be not in favour of continuing the India venture, Kinnevik insisted on staying put and the board eventually agreed to back Jabong.
Jabong receives funds on a regular basis, similar to the financing structure of other multinational corporations, the company said in an email, adding that there are no pre-agreed funding commitments.
"GFG has raised over $1.5 billion in capital in its history and its Board remains unanimously committed to all regions it operates in, including India. Jabong has made a number of recent senior management hires and has also recently witnessed record operating performance. These facts, which are supported by public filings on our current investment rate, are clearly evident of GFG's commitment to growing Jabong," it said in the email.