Walmart sends message to Amazon with Flipkart buy
Walmart is seizing control of the largest e-commerce company in India as the big-box chain’s war with Amazon assumes an increasingly global dimension.
Walmart confirmed Wednesday it would pay about $16 billion for 77% of Flipkart Group, setting the stage for the Indian online retailer to likely eventually become a majority-owned subsidiary.
“India is one of the most attractive retail markets in the world, given its size and growth rate, and our investment is an opportunity to partner with the company that is leading transformation of e-commerce in the market,” Walmart CEO Doug McMillon said in a statement.
The deal comes after Amazon reportedly made a rival bid to acquire a controlling stake in Flipkart in an effort to outbid Walmart. The two archrivals are jockeying for global dominance.
This round goes to Walmart, which said Flipkart had net sales of $4.6 billion during its latest fiscal year and has seen huge growth.
Walmart said it would use its expertise in supply chains, multichannel shopping and “financial strength” to aid Flipkart’s growth.
The company will maintain Flipkart’s brand. Walmart will maintain the 21 stores it already has in India.