Walmart may take Flipkart public sooner than some think

Walmart may take Flipkart public sooner than some think


Walmart Inc. (WMT) said in a regulatory filing on Saturday that it may plan Flipkart’s initial public offering (IPO) as soon as four years, giving a potential listing timeframe for its largest-ever acquisition.

The Bentonville, Arkansas-based retailer intends to take Flipkart public at no less a valuation than that at which it has invested in the Indian-based e-commerce firm, according to a filing with the SEC on 11th of May.

Walmart recently announced that it has decided to acquire about 77 percent stake in Flipkart in a transaction valued at $16 billion, as a part of its efforts to compete head-to-head with Inc. in a rapidly growing Indian e-commerce market, which some believe would reach $200 billion a year within a decade.

Minority stakeholder after the deal include Flipkart’s co-founder Binny Bansal, China’s Tencent Holdings, Microsoft Corp and United States hedge fund Tiger Global Management.

The transaction, which implies a valuation of about $21 billion for Bengaluru-based Flipkart, is subject to the approval of Indian regulatory authorities and is expected to close by the end of this year.

Walmart will initially name five directors for Flipkart’s board, according to the terms of agreement. The filing showed that minority stakeholders will be eligible to appoint two directors, while Mr. Bansal will hold one board seat.

The U.S-based retailer said that it may add a sixth member to Flipkart board in future, with the consent of the other directors. The company also said that it could replace or appoint a new CEO at Flipkart in consultation with the board.

Flipkart was founded by Sachin Bansal and Binny Bansal about a decade ago. The two were the former employees at Amazon. The company initially started by selling books and later added other categories such as consumer electronics and fashion.

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Javier Davis produces news on stocks, currencies, bonds, commodities, and real estate. His in-depth research covers most of the major financial markets in America, Europe, and Asia. His research is based on the interconnected relationships among economic and technical factors that drive valuations in the markets, with an emphasis on how to formulate investment strategies. From interest rates to inflation to economic growth and much more, the fundamental concepts presented on this website provide an essential foundation of knowledge for investors to profit in stocks, bonds, commodities, currencies, and real estate markets.