Flipkart co-founder and executive chairman Sachin Bansal is set to sell his entire 5.5% stake in the company for $1 billion to Walmart, following Walmart’s acquisition of 77% stake in the e-commerce company.
Noticeably, the other co-founder Binny Bansal (not related) will stay at the company. Sachin had held the position of Flipkart’s CEO for nine years, before moving on to become the company’s executive chairman in January 2016.
The duo had set up the online book retail business in 2007 out of an apartment in 2007. Prior to this, Sachin was working as an executive of e-retail rival Amazon.
Sachin was reportedly unhappy with the rest of the Board’s specific decisions to sell the majority stake to the retail behemoth.
This after months of negotiations, SoftBank CEO Masayoshi Son confirmed that Walmart has agreed to buy a controlling stake in Flipkart Online Services. SoftBank is a major shareholder in Flipkart after it invested $2.5 billion through its Vision Fund in 2017.
It was earlier reported Walmart CEO Doug McMillon arrived at the Flipkart headquarters in Bengaluru on Wednesday to announce the deal.
This follows the decision by Flipkart’s board to sell a majority stake to Walmart in a deal that will see SoftBank selling all of its stake in the e-commerce major.
Walmart also issued a statement to the effect.
"Subject to regulatory approval in India, Walmart will pay $16 billion (Rs 104,000 crore) for an initial stake of 77 per cent in Flipkart," the Arkansas-based firm said in a statement from the US.
The acquisition of the majority stake makes Walmart the largest shareholder of the Bengaluru-based Flipkart group.
"The investment underscores our commitment to sustained job creation and investment in India, one of the largest and fastest-growing economies in the world," the world's largest retailer added.
The remainder of the business will be held by some of Flipkart's existing shareholders, Tencent Holdings Ltd, Tiger Global Management LLC and Microsoft Corp.
With IANS inputs