India’s largest e-commerce website and most valued single start-up – Flipkart is on the final stage of selling 70% of its stakes to American giant Walmart and Google’s parent firm Alphabet for approximately $15 billion.
World’s largest retailer wants to buy over 70% of India’s largest online retailer’s stakes and world’s largest search engine’s parent company wants to contribute in the deal. In simpler words, Walmart wants to buy off as many shares of Flipkart as it can and it has been reported that Google’s parent company Alphabet Inc. will contribute in the deal to takeover over 70% Flipkart stakes in a joint-deal. Amazon too was in for the race to buy the stakes, but it did not find much favour from most of Flipkart’s shareholders and the deal is now in the hands of the Walmart-led group.
Walmart’s takeover over Flipkart’s managing board is no new news as the race to acquire India’s largest ecommerce website has been on the go since quite few months. As per initial reports, Flipkart board had agreed to stamp on the deal selling 40% of their company to Walmart. However according to a Bloomberg report, Flipkart board has already approved an agreement to sell around 70-75% of the company to Walmart as well as Alphabet for approximately $15 billion. The high price tag on Flipkart stakes is due to the sudden hike that upsurge the total valuation of the company from $12 million last year to $20 million – making it the most valued Indian startup.
Of the $15 billion deal, Alphabet is expected to be participating in the deal with $3 billion pay cheque to buy off about 10% of the stakes and the rest will be from Walmart. The deal has been finalised as both companies have already signed tentative agreements after meeting on Thursday. However, the final agreement from Flipkart’s shareholders selling shares to Walmart-Alphabet is expected to be made over the weekend and a formal announcement is due mid-next week. The deal might also mean that one of Flipkart’s founder Sachin Bhansal will exit from the company, while Walmart is likely to retain CEO Kalyan Krishnamurthy and Binny Bhansal after the takeover.