US retailer Walmart Inc on Wednesday acquired 77 per cent stake in Flipkart for about USD 16 billion in its biggest acquisition till date. The deal values the 11-year old Indian e-commerce firm at USD 20.8 billion.
Bentonville, Arkansas-based Walmart will acquire about 77 per cent stake in Flipkart, Walmart said in a statement. Sachin Bansal, who had co-founded Flipkart with Binny Bansal in 2007, would exit the company after the deal.
Sachin and Binny, who are not related and formerly worked for Amazon.com Inc, like their US rival began by selling books when they founded Flipkart.
The deal is billed as the biggest acquisition by a company in India this year. This is also Walmart’s biggest acquisition which will help it compete with its US-based rival Amazon.
The biggest M&A deal in India however is the yet-to-be-completed merger of Vodafone India and Idea Cellular to create India’s largest telecom operator, surpassing Bharti Airtel. That deal, worth USD 23 billion, was announced last year.
India, Asia’s third largest economy, needs foreign capital to boost infrastructure and sustain economic growth. According to Department of Industrial Policy and Promotion (DIPP), the total FDI investments in India during April-December 2017 stood at USD 35.94 billion.
(With inputs from PTI)