Walmart Set To Take Over 73% Of Flipkart
After months of speculations, it seems that Walmart may have finally made a settlement with Flipkart. Walmart is set to take over about 73% of Flipkart. The Walmart is expected to spend at least $14.6 billion, and as much as $16 billion in cash and stock buyout. The search engine Google’s parent company the Alphabet Inc. is said to be a part of the deal as it will invest about $3 billion.
According to various sources, Flipkart is valued at US$20 billion while on the other hand the world’s largest retailer Walmart is said to have value Flipkart at as much as US$ 22 billion. At this price, Walmart is set to spend an amount of US 16 billion for this purchase. There have been speculations going on that the deal has been signed by both the parties in a meeting that took place on Thursday.
It’s being expected that the Flipkart CEO, Kalyan Krishnamurthy would still be the chief executive, and some other top-level personnel would maintain their roles. This report was made by few sources and it is being expected that the deal would be a combination of both cash and stock. This action would lead to the exit of some major investors as the cash component would be close to about 55%.
Softbank, an investor in Flipkart is said to exit completely from the picture, it holds about 20% stake in the company and will make around $4 billion. Other investors like Tencent, Microsoft, and Tiger Global are said to still maintain shares. If the deal is successful then not many changes will appear as Flipkart and Amazon the main contenders of online Indian market will still face a head to head competition. Both the companies have not yet made any statement regarding the deal but it’s being expected to be announced soon.