Walmart and Flipkart all set for biggest e-commerce deal

BENGALURU: WALMART Inc. is set to announce the purchase of a majority stake in Flipkart in a deal that will value India’s largest online retailer at more than $21 billion, making it the world’s biggest ever e-commerce acquisition.

The deal is expected to be announced on Wednesday or Thursday with Walmart CEO Doug Mcmillon expected to be in India for the announcement, three people aware of the latest discussions said, requesting anonymity.

The transaction will also mark the end of an era with the impending exit of executive chairman Sachin Bansal, who founded Flipkart in a two-bedroom apartment in Bengaluru’s upscale Koramangala neighbourhood in 2007 with Binny Bansal (not related).

Sachin Bansal is expected to sell his entire 5.5% stake in Flipkart, which started off as an online bookseller, for roughly $1 billion. Most of Flipkart’s biggest investors are expected to sell their entire stakes in the e-commerce giant, although a few, including Tiger Global Management and Tencent Holdings, are expected to retain a small part of their stake in the company.

Mint couldn’t ascertain whether Softbank Group is sell- ing its 20%-plus holding immediately. The Japanese investor has been evaluating ways to avoid paying a hefty tax on its investment.

Flipkart’s group chief executive Binny Bansal, who will also take on the role of chairman after Sachin Bansal’s exit, and CEO Kalyan Krishnamurthy are expected to remain at Flipkart after the deal goes through, the people cited above said.

Earlier, Softbank, which became the largest shareholder in Flipkart when it agreed to invest more than $2.5 billion in the company last August, had been pushing other Flipkart investors to wait for a rival offer from Amazon. But last week, the Japanese firm agreed to go along with all the other key shareholders, including Tiger Global Management, Naspers and Accel Partners, who were firm in their preference for Walmart as a buyer.