US retailer Walmart announced it will lead a $1.2 billion fresh investment in its e-commerce business Flipkart, which it had acquired in 2018, at a valuation of $24.9 billion.
The development come at a time when domestic rival Reliance Industries’ e-commerce venture JioMart is busy raising billions of dollars from marquee investors.
After Facebook acquired a 9.99 percent stake in JioMart for $5.7 billion, American private equity giant Silver Lake Partners bought a percent of Jio Platforms for $750 million. Vista Equity Partners also picked up a 2.3 percent stake for $1.5 billion.
This fresh investment in Flipkart will see participation from a group of existing shareholders. It will be funded in two tranches over the remainder of FY21.
“We are grateful for the strong backing of our shareholders as we continue to build our platform and serve the growing needs of Indian consumers during these challenging times,” said Flipkart CEO Kalyan Krishnamurthy.
“Since Walmart’s initial investment in Flipkart, we have greatly expanded our offerings through technology, partnerships and new services. Today, we lead in electronics and fashion, and are rapidly accelerating our share in other general merchandise categories and grocery, all while providing increasingly seamless payment and delivery options to our customers,” he added.
Founded in 2007, the Flipkart group includes Flipkart, digital payments platform PhonePe, fashion specialty site Myntra and eKart, a logistics and delivery service focused on solving the last mile in India’s Tier II and III cities.
In 2018, Walmart invested $16 billion for a majority stake in the Flipkart group.
Flipkart recently surpassed 1.5 billion visits per month and reported a 45 percent growth in monthly active customers and 30 percent growth in transactions per customer for FY20.
The e-commerce major claims to be offering 150 million products across more than 80 categories.
“Flipkart continues to leverage its culture of innovation to accelerate growth and enable millions of customers, sellers, merchants and small businesses to prosper and be a part of India’s digital transformation,” said Judith McKenna, President and CEO of Walmart International.
“Krishnamurthy and team have a clear vision and are relentlessly focused on offering Indians frictionless choice in how they shop and sell online. We are excited to see what the future holds as they continue their journey to become India’s most trusted e-commerce marketplace,” he added.
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