US-based retail giant Walmart Inc on Saturday said it has completed its USD 16 billion deal with Flipkart and now holds 77 per cent stake in the Indian e-commerce major. The Bentonville giant's investment includes USD 2 billion of new equity funding to help accelerate the growth of the Flipkart business.
The mega deal, announced in May this year, is the largest so far in the Indian retail space. This is also Walmart's biggest acquisition and will help it compete more aggressively with its US-based rival Amazon.
"With the completion of the investment, Walmart now holds approximately 77 per cent of Flipkart. The remainder of the business is held by other shareholders, including Flipkart co-founder Binny Bansal, Tencent, Tiger Global and Microsoft Corp," a statement said.
Flipkart's existing management team will continue to lead the business. Walmart and Flipkart will retain their individual brands and separate operating structures in the country.
Sachin Bansal, who co-founded Flipkart with Binny Bansal in 2007, has exited the company after the deal. Also, SoftBank, which had invested USD 2.5 billion in Flipkart last year, has also exited the e-commerce firm, raking in about USD 4 billion from the deal.
Last week, fair trade regulator Competition Commission of India (CCI) gave its approval to the transaction despite opposition from various trader bodies, including Confederation of All India Traders (CAIT). Mergers and acquisitions beyond a certain threshold require the approval of the CCI.
The statement issued on Saturday said members from Walmart will join Flipkart's Board, along with representation from existing investors Tencent Holdings and Tiger Global Management LLC as well as independent board members.
Also, Flipkart's financials will now be reported as part of Walmart's International business segment.
Walmart, which currently operates 21 cash-and-carry stores in India, is keen on working with Flipkart to grow in India, which is one of the fastest-growing and most attractive retail markets in world.