Walmart, world’s largest store, has sooner or later confirmed that it is making a $16 billion funding into Flipkart for a 77 percent share of the web store. Tencent, Tiger worldwide, Microsoft, Accel and Flipkart co-founder Binny Bansal will continue to be investors within the agency with this deal.
The investment will value Flipkart, India’s biggest online retailer with 54 million active customers and projected gross merchandise value of $7.5 billion for 2018, and expected to be $20.8 billion when the deal closes. Which is expected to happen later this year after getting regulatory approval.
Flipkart will give Walmart a big step up in its business in Asia by helping it better tap the region’s second-largest market after China, and one of the world’s fastest-growing economies. Walmart India already has 21 Best Price cash-and-carry stores and one fulfillment center in 19 cities across nine states in India. Walmart said earlier that Krish Iyer, the president and chief executive officer of Walmart India, will continue to lead that business.
The investment in Flipkart becomes the biggest-ever that Walmart has made in its history, supplanting Asda in the UK. Walmart intends to keep Flipkart as a distinctive brand and even help the company towards a “publicly-listed, majority-owned subsidiary” in the future.
Tencent and Tiger Global will be on the Flipkart board, with new members from Walmart. “The final make-up of the board has yet to be determined, but it will also include independent members,” Walmart said. “The board will work to maintain Flipkart’s core values and entrepreneurial spirit while ensuring it has strategic and competitive advantages.”, they added.
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