Walmart Inc. and Flipkart Group announced the closing of the agreements for Walmart to become the largest shareholder in the Flipkart Group.
“Walmart and Flipkart will achieve more together than each of us could accomplish separately to contribute to the economic growth of India, creating a strong local business powered by Walmart,” said Judith McKenna, president and CEO of Walmart International, in a statement.
In May this year, Walmart said it had agreed to pay $16 billion for about 77% stake in Flipkart, a transaction that valued the homegrown e-commerce company for over $20 billion. The deal would pitch Walmart, the world’s largest retailer in direct competition with its U.S. rival Amazon.com in a battle for dominance of India’s online retail market.
The announcement comes after the Competition Commission of India (CCI) recently approved Walmart’s plan to acquire the majority stake in Flipkart, despite the protests from Indian traders.
Ms. McKenna said Walmart’s investment will benefit India by providing quality, affordable goods for customers while creating new skilled jobs and opportunities for suppliers.
“We are delighted to learn from, contribute to and work with Flipkart to grow in India, one of the fastest-growing and most attractive retail markets in [the] world,” said Ms.McKenna.
With the completion of the investment, Walmart now holds approximately 77% of Flipkart. The remainder of the business is held by other shareholders, including Flipkart co-founder Binny Bansal, Tencent, Tiger Global and Microsoft Corp. Walmart’s investment includes $2 billion of new equity funding to help accelerate the growth of the Flipkart business.