Walmart is going to become the largest stakeholder in Flipkart. The talks between Walmart and Flipkart are at the final stage. Here, it is important to mention that Flipkart is an Indian e-commerce giant. And, Walmart is the largest e-commerce in America. If the deal finalizes, Walmart will be in direct competition with another American e-commerce giant Amazon. There are reports that Walmart may buy 20-26% shares in the beginning. It will later increase its shares to 51% and become the largest shareholder. Walmart will invest $10-12 billion to finish the buying process.
This deal will also include buying shares from other stakeholders. One of the peoples aware of the entire discussions says that the primary investment will be $1-2 billion. It will depend on the size of the deal also. It will buy the rest of the shares from other investors. Here, it is also pertinent to mention that the final pattern of the deal is not clear. The final investment will be between $20-22 billion. This shows that the value of the e-commerce giant has increased 100% from its value $10.2 in April 2017.
It is also worth mentioning that the valuation of Flipkart had reached $14.2 billion after Japan’s Soft Bank had invested in it. Walmart is also in talks with some big investors of Flipkart. If all goes well, it will be the largest exit of investors from Flipkart. Tiger Global and Soft Bank are the two largest investors that may exit Flipkart. This is because they are eyeing the double stake. Both these shareholders have $4-4.5 billion stakes in Flipkart.
The experts are of the view that the competition among Amazon and Walmart will benefit the Indian population a lot. Walmart also considers Flipkart, an ideal candidate to invest. This is because its value is between Amazon and Alibaba.