The world’s biggest brick-and-mortar retailer has sought a route to majority as it embarks on a renewed online push to take on Amazon in the US and across the world, people directly aware of the matter told TOI. The ongoing talks between Walmart and the Indian etailer entail multiple options, including one to buy out Flipkart’s numerous early shareholders, paving the way for a substantial interest.
US-headquartered retail giant Walmart is looking to acquire a big stake in homegrown ecommerce unicorn Flipkart. If the deal goes through, it would catapult Flipkart’s valuation to USD 20 Billion from its current valuation of USD 11.6 Billion.
Walmart is firming up its interest in Flipkart almost eighteen months after the talks first began between the two companies. People aware of the development mentioned,
“Post the diligence, Walmart’s offer involves one-fifth in primary capital with the rest of the transaction being secondary sale of shares to Walmart by existing investors. Walmart wants to start ahead of Amazon and India will be the only market where it can possibly do that by investing in Flipkart, which is being valued at USD 18-20 billion,”
Over the last 18 months, the two companies have been exploring the different options that would allow Walmart to acquire a big stake in the Indian online marketplace. For the deal to take place, Walmart will likely have to buy out a number of Flipkart’s early shareholders.
While Flipkart’s long list of early financial investors like Tiger Global may explore the Walmart offer to cash out, the response from some of the other significant shareholders in Flipkart, such as South African media and internet group Naspers and China’s Tencent, to the Walmart proposal will be closely watched, sources indicated.