Amazon makes formal offer to buy 60% stake in Flipkart

The acquisition of Flipkart by Walmart will be an extension of its domestic battle with arch rival Amazon whose expansion is the biggest threat to the retail icon

Amazon makes formal offer to buy 60% stake in Flipkart

Flipkart is already in talks with Walmart, the American supermarket retailer, to acquire a majority stake thought to be worth up to $12 billion.

Amazon has emerged as new contender for Indian e-commerce giant Flipkart.

Investors expect faster returns from Walmart's investments compared to Amazon, said Yarbrough, a move that limits the brick-and-mortar retailer's ability to spend big on acquisitions in growth markets.

FILE PHOTO: A Common myna sits next to the logo of India's e-commerce firm Flipkart installed on the company's office in Bengaluru, India April 12, 2018.

USA online retail major Inc is reported to have made a formal offer to buy a 60 per cent stake in Indian online retailer Flipkart. Any Flipkart-Amazon deal is likely to come under the scanner of the Competition Commission of India (CCI), given the dominant market share these two entities have grabbed in the e-commerce space - around 70 per cent collectively. The offer is said to be on par with a previous one submitted by Walmart recently.

Amazon has made an official offer to acquire a 60% stake in Flipkart. It bought for $3.3 billion in August 2016. Moreover, a longdrawn process could also create uncertainty among employees and vendors of Flipkart, the sources said.

Flipkart and Amazon India did not reply to email queries. The Walmart deal would retain Flipkart's existing structure, while Amazon hasn't released details on its plans.

Last month Bloomberg reported the Bentonville, Arkansas-based retailer was likely to emerge as the victor of the bidding war with it offering around $20 billion. Indian market has been a major focus of Amazon's expansion efforts, since online shopping is rapidly increasing here. At that time, Flipkart had also raised funds from eBay, Tencent Holdings and Microsoft Corp. And with that news, a number of companies, including Google and Amazon, seem to want a piece of the Flipkart's pie. The stake could reach as high as 80%, reported Bloomberg. Flipkart's investors and founders are in favour of the deal with Walmart, with founder Sachin Bansal overseeing final negotiations with Walmart, the TV report said. It has also announced products tailored to the market, including 18 original series in India. Walmart doesn't have an online presence in India, but as of this year, Amazon has emerged as the leading e-commerce player in the country.

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