CCI clears Walmart-Flipkart deal

MUMBAI/BENGALURU: India’s antitrust regulator has approved Walmart Inc.’s $16-billion purchase of Flipkart, despite protests from traders across the country over fears that the deal would drive several small retailers out of business.

On Wednesday evening, The Competition Commission of India (CCI) posted a tweet from its official Twitter handle, confirming it had approved the deal, without sharing any further details.

Interestingly, CCI said that Flipkart’s discounting practices may need to be dealt with separately, an issue that assumes significance in the wake of the new draft policy that proposes further restrictions on discounting by online marketplaces. India already bans discounting by online marketplaces.

“The issues concerning FDI policy would need to be addressed in that policy space to ensure that online market platforms remain a true marketplace providing access to all retailers,” CCI said in its order.

CCI’s approval, which had

been expected by Walmart and Flipkart sometime this month, paves the way for the companies to close the deal.

On May 9, Walmart agreed to pay $16 billion for a 77% stake in Flipkart, valuing India’s largest start-up at about $21 billion in what is one of the biggest acquisitions in the country.

Walmart had sought approval for the deal on May 19, days after it announced the proposed buyout of Flipkart. At the time, Walmart had said the deal did not create any competition concerns and that the pecking order of the broader retail market in India

would remain unaffected by it.

Walmart welcomed the CCI’s decision. “Our partnership with Flipkart is testament to our continued confidence in our ability to contribute to this market. Flipkart is a prominent player in India with a strong, entrepreneurial leadership team that is a good cultural fit with Walmart. We believe that the combination of Walmart’s global expertise and Flipkart will position us for longterm success and enable us to contribute to the economic growth,” Walmart said.

Shrutika Verma in New Delhi contributed to this story.