Walmart to raise $3 billion for Flipkart

“Walmart may prefer to bring strategic investors to Walmart-Flipkart through this fundraising, unlike the previous round. However, Walmart-Flipkart is also ready to sell to large pure-play investment firms,” ​​said one of the two people.

Flipkart last raised around $3.6 billion in July last year. According to the two people mentioned above, the majority of this capital has been deployed, and there is about $700-800 million left.

“Walmart is keen to bring strategic investors into Walmart-Flipkart to provide additional expertise as well as continued funding support to Flipkart,” the first person, requesting anonymity, said.

A Walmart spokesperson declined to comment on what it termed as speculation. A Flipkart spokesperson said there are no such plans at the moment, and the news is speculative and false.

Walmart has yet to formally mandate investment bankers to seek strategic partners and large global investors for the latest fundraising plan.

The first person said, “This money can be used not only to add resources, such as fulfillment centers (storage and warehousing), new businesses and workforce, but also for potential acquisitions in the Indian e-commerce sector. “

Flipkart is currently valued at over $40 billion and could dilute about 7% to raise up to $3 billion, the people cited above said.

Since Walmart acquired a 77% stake in Flipkart for $16 billion in 2018, the e-commerce firm did its first capital infusion round in July last year, valuing Flipkart at around $37 billion.

The planned fundraising will help Flipkart build a battle chest to compete with aggressive rivals Amazon India, Reliance Industries’ Jio Mart and the Tata Group.

In previous funding rounds, Canada Pension Plan Investment Board, Singapore government’s sovereign wealth fund GIC, Japan’s SoftBank Vision Fund 2 and Flipkart’s parent Walmart along with participation from Qatar Investment Authority, Malaysia’s Khazana National Bhd and Disrupted, China’s Tencent Capital investment led. , Franklin Templeton and Tiger Global.

However, as per the latest fundraising plan, Walmart is keen to bring in strategic players who can invest money to not only fuel Flipkart’s growth, but also help Flipkart stay afloat in the country’s e-commerce space. Can also provide expertise for

Over the past three years, the government’s push for digitization and customer preference for online transactions amid the pandemic has fueled the business of e-commerce platforms such as Flipkart and Amazon.

Since the acquisition of Walmart, Flipkart has expanded to new locations in India and added new product categories to its online marketplace. For example, Flipkart now sells a full range of furniture and grocery items on its platform. The e-commerce company has also added new warehouses to deliver products faster.

In the past year, Flipkart has also launched Flipkart Pay Later services and opened a research and development center in Israel after acquiring Israeli startup Upstream Commerce.

As of July 2021, Walmart held 72% in Flipkart, Tencent 5.3%, Tiger Global 4.1%, founder Binny Bansal 2.4%, CPPIB 2.2%, SoftBank 1.4%, Qatar Investment Authority 1.3%, Microsoft 1.2% and Accel Partners 1.1% . ,