Global e-commerce giant Amazon.com might be in race to buy its Indian rival Flipkart, media reports said citing sources. The reports come amid news of US retailer Walmart's bid for Flipkart. Walmart is said to be eyeing 25 per cent to 55 per cent stake in Flipkart.
However, a deal with Walmart is more likely to go through, according to people with knowledge of the matter, the report added. It is speculated that Walmart, which is yet to make a strong foothold in the country, is planning its grand India entry through Flipkart.
The US retailer is eyeing a majority stake through a mix of primary and secondary share purchases in a deal that could value Flipkart at $21 billion, the reports said.
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The deal is set to hot up Indian online retail space, 40 per cent of which is controlled by Flipkart, ahead of Amazon, according to estimates by research firm Forrester. If the Walmart deal comes through, it will help Flipkart in its fight against Amazon, which has committed to investing $5 billion in India as it expands aggressively, including into online grocery deliveries, which analysts tip as the next big battleground for the country’s e-commerce sector.
Media reports had stated that Flipkart is in the process of launching its own private label of consumables and fast moving consumable goods (FMCG). Earlier, Flipkart had piloted its online grocery sales project called 'Nearby' in Bengaluru. But this was later shut down in November 2016. The company is planning a come back to the segment. Amazon, too, is eyeing a pie of the online grocery space. Alibaba-backed BigBasket and SoftBank's Grofers are already the major players in the online grocer segment.
In August 2017, Japan’s SoftBank Group had invested about $2.5 billion in Flipkart, which increased the latter's valuation to $14 billion. Founded by former Amazon employees Sachin Bansal and Binny Bansal in 2007, Flipkart's investors include Tiger Global Management, Accel Partners, Naspers and IDG Ventures.