Walmart have announced the closing of the agreements for Walmart to acquire Flipkart becoming the largest shareholder in the Flipkart Group.
“Walmart and Flipkart will achieve more together than each of us could accomplish separately to contribute to the economic growth of India, creating a strong local business powered by Walmart. Our investment will benefit India by providing quality, affordable goods for customers, while creating new skilled jobs and opportunities for suppliers. As a company, we are transforming globally to make life even easier for customers, and we are delighted to learn from, contribute to and work with Flipkart to grow in India, one of the fastest-growing and most attractive retail markets in world.”
– Judith McKenna, President and CEO of Walmart International
There is already some debate over which is now the largest marketplace in India, made somewhat opaque by the way Flipkart and Amazon measure sales. Amazon discount refunds from their claimed turnover but say on all possible metrics they’re now bigger than Flipkart. Flipkart have had a good last quarter and also claim to be ahead. What is known is that Amazon are a relative newcomer to India and if they’re anywhere close to Flipkart then they’ve grown massively and are poised for further growth so now it’s down to Walmart to fend them off and reinvigorate Flipkart.
With the completion of the investment, Walmart now holds approximately 77% of Flipkart. The remainder of the business is held by other shareholders, including Flipkart co-founder Binny Bansal, Tencent, Tiger Global and Microsoft Corp. Moving forward, Flipkart’s financials will be reported as part of Walmart’s International business segment.
Walmart’s investment includes $2 billion of new equity funding to help accelerate the growth of the Flipkart business. Both companies will retain their unique brands and operating structures in India.
“We are poised and ready to deliver the full value of this partnership for India. By combining Walmart’s omni-channel retail expertise, supply-chain knowledge and financial strength with Flipkart’s talent, technology and local insights, we are confident that together we can drive the next wave of retail in India.”
– Binny Bansal, Co-founder and Group CEO, Flipkart