FIH Mobile, the investment subsidiary of the world’s largest contract manufacturing giant, Foxconn Technology Group has written off an additional $40 million of its $200 million bet on Gurgaon-based online marketplace Snapdeal.
The latest write-down comes about nine months after the Hong Kong-listed unit of the Apple iPhone manufacturer announced that it had undertaken an impairment loss of $160 million. In its 2017 annual report, FIH Mobile has said the company had come to the view that its entire $200 million investment in Jasper Infotech, first announced in September 2015, cannot be recovered.
“As the recoverable amount of the investment in Jasper Infotech is minimal, the Group decided to make a further $40 million impairment loss as on 31 December 2017. As a result, JIPL represented no more shares of the Group’s total assets as on 31 December 2017,” the FIH 2017 annual report stated. FIH has estimated that the recoverable amount of its investment in Jasper Infotech is $3 million, with the investor citing the failed merger between Flipkart and Snapdeal as being one of the causes behind its decision to record $160 million impairment.
“While the negotiation was finally terminated due to dissent of minority shareholders and complicated tax problems between Singapore and India. In 2017, the main market players had moved into the next stage to provide more products and services via collaboration with various business partners, which limited the room for JIPL to develop in the future.”