Venture Capital: Walmart To Raise Upto $3B For Indian E-Commerce Subsidiary Flipkart
The valuation of Flipkart in the round could be around $40B.
A news report said Flipkart, Walmart’s (NYSE: WMT) Indian e-commerce subsidiary was mulling a fundraise of $2 – 3 billion at a valuation of over $40 billion to drive a country-wide expansion. Last year, Flipkart raised $3.6 billion in a funding round that had the Canada Pension Plan Investment Board, GIC, SoftBank Vision Fund 2 and Walmart as investors. That round gave it a valuation of $37.6 billion. (Moneycontrol)
Walmart acquired a 77% stake in Flipkart in 2018 for $16 billion.
People in the know said to Mint: “Walmart may prefer to bring strategic investors into Walmart-Flipkart through this fundraising, unlike in the last round. However, Walmart-Flipkart is also open to selling to large pure-play investment firms.” Therefore, the Walmart-Flipkart investment bankers would likely pitch to marquee global investors and strategic partners.
“Walmart is keen to bring in strategic investors in Walmart-Flipkart so that Flipkart can get additional expertise as well as consistent funding support as and when required to stay ahead in the country’s e-commerce competition,” added another source.
Well-funded rivals giving Flipkart a run for its ecommerce money include Amazon India, Reliance Industries’ Jio Mart and the Tata group. However, Amazon and Flipkart have received a boost to their volumes after the pandemic and the country’s adoption of digitalized commerce.
An estimated 7% dilution at a valuation of $40 billion would raise as much as $3 billion.
However, Flipkart dismissed the report, describing it as inaccurate and speculative.
Meanwhile, a few days ago there were reports that PhonePe, an Indian payments and financial services unicorn also backed by Walmart, was negotiating a fundraise at a valuation of over $12 billion, with General Atlantic likely to lead the round with an investment in the range of $450 – $500 million.
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