MUMBAI/BENGALURU: Indian e-commerce firm Flipkart’s board is yet to finalize a deal to sell a stake to Walmart Inc, two sources with direct knowledge of the matter said on Friday, adding that a deal could just be days away.
Bloomberg reported earlier on Friday, citing unnamed sources, that Flipkart’s board had approved a deal to sell a stake of about 75 percent in the company to a group led by US retail giant Walmart for about $15 billion.
Walmart is in advanced talks with Flipkart to acquire a controlling stake in the Bengaluru-based online marketplace at a valuation of at least $18 billion, Reuters has previously reported.
A third source told Reuters that while Flipkart’s board has “in-principle” approved engaging with Walmart based on the terms of an offer before them, taxation related concerns and a few other issues need to be resolved.
Sources have said that Amazon.com Inc. has shown an interest in buying Flipkart, India’s top homegrown e-commerce firm, but a deal with Walmart is much more likely to go through. Amazon is Flipkart’s biggest rival in India.
The first two sources said Alphabet Inc. is also likely to invest in Flipkart alongside Walmart, but terms of the deal may change. Japan’s SoftBank Group, the biggest investor in the Indian firm through its private equity fund, is considering selling its stake as part of the deal if the price is right, another source said.
Flipkart and Alphabet did not respond to Reuters requests seeking comment. Walmart and SoftBank declined to comment.
Flipkart, together with its fashion units Myntra and Jabong, controls nearly 40 percent of India’s online retail market, while Amazon is a close second with a 31 percent share, according to data from research firm Forrester.
Both Amazon and Flipkart are pouring billions of dollars to win shoppers in the fast-growing market that is expected to be worth $200 billion a year within a decade.
Earlier this week, Indian TV channel CNBC-TV18 reported Amazon had made a formal offer to buy 60 percent of Flipkart and that it had also proposed a $2 billion breakup fee to convince Flipkart to discuss its offer.