Rumors have been circulating the past few months, but Amazon has finally made a formal offer to buy a 60 percent stake of Flipkart, the Indian retail e-commerce giant. This offer has complicated Walmart’s bid for majority ownership in Flipkart. According to a report by Reuters last month, Walmart was about to buy a majority stake in Flipkart for between ten and twelve billion dollars.
This news highlights Amazon’s determination to broaden their presence in the Indian e-commerce market, and their offer could also be a maneuver to block Walmart from getting their expertise in logistics and supply chain management to Flipkart.
Two anonymous sources confirmed that Amazon is very interested in buying Flipkart, but they did not give any further details about this. People familiar with the matter said that the discussion between Amazon and Flipkart is still ongoing and a deal is supposed to be finalized soon.
Any of the three parties have no official comment on this matter. Amazon declined to comment, stating that it does not offer comments on rumors and speculation. A spokesperson from Walmart declined to comment, and Flipkart did not immediately respond to a request for comment.
Amazon’s CEO, Jeff Bezos, wrote a letter to its shareholders last month, in which he stated that Amazon was India’s fastest growing online marketplace.
There has always been a fierce battle between Amazon and Walmart – two retail giants in the United States. While the talks between Walmart and Flipkart have been in the pipeline for quite some time now, Amazon’s sudden entry in this is sure to ignite the war in the Indian waters as well. And because the online sales market in India is rapidly gaining momentum and is expected to be worth $200 billion a year within a decade, both the companies have locked horns for greater control.
“It’s a really big deal for the Indian startup ecosystem,” said Amit Kumar Agarwal, co-founder and CEO of NoBroker.com. “Flipkart is a company that conquered the market and had a great journey. What happens to Flipkart will in some way impact the entire ecosystem.”