Amazon, an American electronic commerce and cloud computing company, has offered to buy the Indian e-commerce firm Flipkart. The daily local Mint has revealed the news of the seemingly possible deal citing sources. Flipkart, however, is in talks with Walmart, an American multinational retail corporation, for the stakes of the sale. Flipkart is fighting their hardest to stop Amazon from buying their stakes. An insider has commented that the deal with Walmart is more likely to go through that with Amazon.
Walmart is offering to buy a stake of over 40 percent in Flipkart. This is a direct challenged posed to Amazon which controls the 3rd largest economy in Asia. Walmart is thinking about buying a majority of Flipkart’s stake through a mix of some primary and secondary share purchases. This will make Flipkart’s value at $21 billion. Walmart has already invested $5 billion in the Indian market and it continues to grow aggressively in India as the grocery deliveries are going to be the next big battleground for country’s e-commerce sector.
Flipkart is seen as one of the most attractive assets in the global internet economy, benefiting from the long-term potential ascribed to India’s market by investors. Flipkart was founded by two former Amazon employees, Sachin Bansal and Binny Bansal back in 2007 and Flipkart rules over 40% of India’s online retail. According to analysts, Flipkart leaves behind Amazon by quite a mark. Amazon and Walmart are not the only two companies who have shown interest in Flipkart. Previously, Google has shown interest to buy Flipkart’s stake priced at approx $15-$16 billion. Tiger’s Global Lee Fixel is looking over the negotiations from Flipkart’s side. However, Amazon and Flipkart have not commented anything on the matter and they have not responded to any emails regarding this matter.