Walmart confirms $16B Flipkart investment, giving it 77% in India’s e-commerce leader

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NEW DELHI: India’s largest e-commerce company Flipkart on Wednesday agreed to sell 77 per cent stake to US retail giant Walmart for $16 billion. Ahead of the official announcement, TOI had accurately reported the deal size.

Walmart also plans to pump $2 billion (nearly Rs 13,000 crore) as fresh equity into Flipkart to strengthen its hold on the e-commerce firm.

Rival Amazon was reportedly interested in acquiring control of Flipkart but the Indian online retailer went for the deal offered by Walmart. Meanwhile, SoftBank CEO Masayoshi Son said that Walmart-Flipkart agreement was made on Tuesday night (Japanese time).

The journey of Flipkart started when two IIT-Delhi graduates left their jobs at Amazon to pursue entrepreneurial dreams.

Here is a look back at the company’s journey from a two-bedroom office to where it is now:

* Flipkart was founded 11 years ago in 2007 by Sachin Bansal and Binny Bansal. Although they share the same last name and come from Chandigarh, the two Bansals are not related. A batch apart in IIT-Delhi, they became friends while working together at Amazon.

* Flipkart was started from a two-bedroom apartment in Bengaluru’s Koramangala area as an online bookstore. From those humble beginnings it would go on to become the country’s largest e-commerce player.

* It opened its first office in Bengaluru in 2008 followed by offices in Delhi and Mumbai in 2009. Last month, Flipkart consolidated all its Bengaluru offices into one large campus sprawled across 8.3 lakh square feet.

* In 2011, Flipkart domiciled to Singapore, as it looked to woo foreign investors to fund rapid growth.

* Sachin was Flipkart CEO for nine years. In 2016, Binny Bansal took over as CEO as Sachin became executive chairman.

* Last year, Kalyan Krishnamurthy, previously an executive in Flipkart investor Tiger Global, took over as Flipkart CEO. Binny Bansal became CEO of the whole group, which includes fashion portals Myntra-Jabong, payments unit PhonePe and logistics firm Ekart.

* Flipkart bought online apparel retailer Myntra in a deal pegged by sources at about $300 million in 2014, and another fashion retailer Jabong for $70 million in 2016.

* It bought payment startup PhonePe in 2016. In exchange for an equity stake in Flipkart, eBay agreed to make a $500 million cash investment in and sell its business to Flipkart in 2017.

* Japan’s SoftBank is currently the largest investor in Flipkart with a 23-24 per cent stake, along with early backer South African media and internet giant Naspers, which holds 13 per cent. Other investors include New York-based hedge fund Tiger Global, US private-equity firm Accel Partners, China’s Tencent Holdings Ltd, eBay Inc and Microsoft Corp.

* In terms of financial statistics, Flipkart Group’s consolidated loss attributable to owners of the company in fiscal 2017 widened to Rs 8,770 crore, from Rs 5,216 crore a year earlier. Consolidated revenue jumped 29 per cent to Rs 19,855 crore in fiscal 2017.

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