Walmart announced over the weekend that it has completed a $16 billion investment in Flipkart that sees it become the majority owner of the Indian e-commerce company.
The deal was first revealed back in May and now it has closed after receiving the necessary approvals. It sees Walmart take a 77 percent share in the company, buying out a number of prior investors in the process and expanding its rivalry with Amazon to a new horizon. The investment capital also includes $2 billion in new equity funding which will be used for growth while the transaction was structured so that Flipkart itself can still go public. That latter point could mean that the Indian firm must go public within four years, as TechCrunch previously reported.
Flipkart will continue to be run by its leadership with Tencent and Tiger Global retaining board seats. Those two have remained investors in the business, alongside others that include Flipkart co-founder Binny Bansal and Microsoft. Walmart previously suggested that other allies would come aboard as investors. Google was strongly mooted, but so far there have been no strategic additions.
Walmart said that its plans for India will include investments that “support national initiatives and will bring sustainable benefits in jobs creation, supporting small businesses, supporting farmers and supply chain development and reducing food waste.”
As we previously reported, it also plans to use Flipkart as a “key center of learning” for the rest of its business across the world, and that includes its home market.