Walmart set to acquire Flipkart
Walmart Inc. has completed a thorough due diligence process on e-commerce firm Flipkart this week, two people said, as the US retail giant looks to take a controlling stake of 51% or more in the Indian e-commerce firm.
Walmart has already floated a shareholder agreement, or offer proposal, and is looking to shell out about $10 billion to $12 billion for the stake that would value Flipkart at roughly $20 billion.
Walmart’s investment would give Flipkart not just additional funds to fight Amazon, but also arm it with a formidable ally with extensive experience in retailing, logistics and supply chain management.
For Walmart, a Flipkart deal would open up a vast market and another front to take on its biggest rival.
Amazon also want Flipkart
A stake in Flipkart would pit Walmart against Amazon.com Inc. in India. Amazon is exploring a rival offer for India’s largest home-grown e-commerce player. Amazon is an e-commerce retailer and Walmart is physical store retailer keen on entering e-commerce.
Bengaluru-based Flipkart, started by two former Amazon employees Sachin Bansal and Binny Bansal (not related), is fighting Amazon to grab a bigger piece of India’s massive online retail market which, according to Morgan Stanley, could be worth $200 billion in a decade.
(Adapted from Livemint)