Walmart Wants to Hit Amazon Hard in India
Walmart Inc. is looking to hit hard against Amazon in India, as the mega-retailer is in talks with India-based ecommerce company Flipkart to stake a more than 40 percent claim in the company, Reuters has reported, citing two sources familiar with the deal.
The Bentonville, Ark.-based company is seeking to purchase new and existing shares in Flipkart, possibly beginning as early as next week, the news outlet said. Amazon already has committed to investing $5 billion in India, with plans to expand into such areas as online grocery delivery.
Flipkart reportedly is looking to expand into groceries, Reuters said. Currently, Flipkart owns its ecommerce site, as well as fashion portals Myntra and Jabong. It also controls almost 40 percent of India’s online retail, ahead of Amazon.
While Walmart has tried to enter India for years, it has remained confined to a cash-and-carry wholesale business there amid tough restrictions on foreign investments, Reuters noted. The new deal could give the retailer access to an ecommerce market that Morgan Stanley has estimated to be worth about $200 billion in a decade.
Although terms of the discussion weren’t available, Flipkart would be valued at more than the $12 billion proposed when Japan’s SoftBank Group Corp.’s Vision Fund took one-fifth of the firm last year for $2.5 billion.
This isn't the only time this year that Walmart has shown interest in ecommerce companies abroad. Last month, Wal-Mart Stores Inc. President and CEO Doug McMillon and Rakuten Inc. Chairman, president and CEO Hiroshi “Mickey” Mikitani formed a strategic alliance to grow consumer reach and enhance how customers are served in Japan and the United States.