Walmart Steps Toward Flipkart Acquisition By Completing Due Diligence

Walmart has completed a thorough due diligence process on Indian eCommerce firm Flipkart as it prepares to take a controlling stake in the company.

According to Reuters, the U.S. retail giant wants to take a stake of 51 percent or more in the Indian online store.

Sources revealed that Walmart has already presented a shareholder agreement and is looking to offer about $10 billion to $12 billion for the stake, which would value Flipkart at around $20 billion.

Talks between the two companies are ongoing. Both declined to comment.

In February, it was reported that Walmart was looking to acquire a 40 percent stake in Flipkart. But now, it seems the company is looking for a bigger piece, most likely so it can take on Amazon in India.

“As large as they [Walmart] are, Amazon has eaten away at a significant chunk of their revenues and I think … they view India as the largest market possibly for this [taking on Amazon],” a source said back then.

If the deal is completed, it would represent one of the largest overseas deals Walmart has ever contemplated.

Flipkart, which is backed by companies such as SoftBank, Tiger Global, eBay, Accel Partners, Naspers, Tencent Holdings and Microsoft, has been competing with Amazon for a bigger piece of India's online retail market, which could be worth $200 billion in a decade.

The deal with Walmart would give Flipkart additional funds, as well as the benefit of the retailer's extensive experience in retailing, logistics and supply chain management.

Sources also said the acquisition could assist Flipkart in developing its private label collection. That news comes as Amazon has also been looking to expand its own private label offerings in India.

Amazon India VP Manish Tiwary said in February that the company is hoping to launch new product categories, but he would not name specific items. “We have selection gaps in every category … our large vendors on the private labels side, we’ll keep on filling the gaps using them,” he said.



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.