Walmart acquires 77% stake in Flipkart for nearly $16 billion
The deal values the Indian e-commerce firm at $20.8 billion.
United States multinational retailer Walmart acquired 77% stake in Flipkart for nearly $16 billion (Rs 1.07 lakh crore). Flipkart’s existing shareholders, including Flipkart co-founder Binny Bansal, Tencent Holdings Limited, Tiger Global Management LLC and Microsoft Corp will hold the remainder of the business, the American retailer said in a statement.
The deal values Flipkart at $20.8 billion (Rs 1.39 lakh crore), PTI reported. Sachin Bansal, co-founder of the e-commerce giant, will exit the company following the deal.
“India is one of the most attractive retail markets in the world, given its size and growth rate, and our investment is an opportunity to partner with the company that is leading transformation of eCommerce in the market,” said Doug McMillon, Walmart’s president and chief executive officer. “Our investment will benefit India providing quality, affordable goods for customers, while creating new skilled jobs and fresh opportunities for small suppliers, farmers and women entrepreneurs.”
On Saturday, reports said that Walmart had struck an agreement to buy 80% stake in Flipkart. Wednesday’s deal confirms India’s status as the largest emerging e-commerce market in the world, with Amazon and China’s Alibaba also competing.
According to Flipkart’s filing with Singapore’s Accounting and Corporate Regulatory Authority, the company bought back over 1.8 million shares worth more than $350 million from minority investors on Saturday, valuing the company at $17.69 billion.
Flipkart was rated the third-most funded private company in the world in 2017 after it secured over $7 billion from major investors including Softbank, Tiger Global and DST Global. The firm, founded by Indian Institute of Technology-Delhi alumni Sachin Bansal and Binny Bansal in 2008, is considered to be one of the most successful firms in India.