Retail king Kishore Biyani eyes selling 10% stake to Amazon or Walmart

Amazon founder Jeff Bezos has committed investments to the tune of $5 billion for the Indian market

Amazon founder Jeff Bezos has committed investments to the tune of $5 billion for the Indian market

Founded in 2007, Flipkart is seen as one of the companies at the forefront of India's e-commerce revolution, having grown rapidly since its inception. The deal will see Walmart increase its foothold in Indian eCommerce, a market which is expected to surge in the next decade.

Nowhere in the world, Walmart has a market place model, " Mr Mahajan said in a letter written to the Prime Minister.

Importantly, according to media reports, he has already met Amazon's Jeff Bezos, Walmart and Alibaba to discuss various business opportunities with them. To put things in perspective, some of India's well-known companies like software giant Wipro Ltd are valued less than Flipkart's current market capitalization.

S&P lowered Walmart's outlook to negative from stable, citing increasing leverage and risks stemming from the company's spending to expand online and globally as it continues its share buyback program. For now, the remaining portion of Flipkart will continue to be owned by existing investors including its co-founder Binny Bansal, as well as Tencent, Tiger Global and Microsoft.

Walmart buys 77% percent stake in Flipkart for $16 billion.

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According to Forrester Data, the Indian online retail market is around $20 billion in 2017 (2.4% of total retail market in India), which is still relatively small when compared to the penetration rates of other mature markets. "The sale of ASDA in the United Kingdom also meant that Walmart needed to identify a new growth avenue - and long frustrated by the byzantine laws governing foreign investment in Indian retail, growing via bricks and mortar retail would have been too complex and slow".

To get an early advantage in the nascent grocery industry in India, Future Group is all set to launch e-commerce app for grocery delivery offering the daily and weekly requirements to consumers. India is the next big potential prize after the US and China, where foreign retailers have made little progress against Alibaba Group Holding Ltd.

Walmart runs 21 Best Price wholesale stores in the country that sell everything from fast-moving consumer goods to furniture to other retailers and institutions.

The deal also shows how Walmart CEO Doug McMillon is reshaping the company's global operations, prioritizing faster-growing markets like China and India over more mature ones. Flipkart valued 12 billion United States dollars a year ago and with Amazon keen on holding Flipkart, Walmart inked the deal. Last month, the company agreed to cede control of its United Kingdom grocery chain, Asda, merging it with British rival J Sainsbury. Walmart will retain a 42 percent stake in the combined company.

Flipkart competes with Amazon across a range of product categories. At that point, Meena wrote that Amazon was closing the gap with Flipkart to become the single-largest online retailer in India in terms of sales.

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