As part of the Walmart-Flipkart deal, Google’s parent Alphabet was reported to be investing around $2 billion to pick up roughly 10% stake. However, Business Standard reports that the tech giant has not yet decided whether it will be investing in Flipkart as it weighs the pros and cons of the deal.
Flipkart’s significant investors Tiger Global and Walmart are reportedly keen on bringing Alphabet on board and have had nearly five rounds of discussions with the tech major to convince it to make the investment.
Alphabet reportedly is evaluating what Flipkart will bring to the table, since it already has access to user data. Walmart and Tiger’s point to Alphabet is that the deal will give it access to Flipkart’s massive user base of 175 million registered users, which can help Google provide a more targeted search experience for its users. This, the report states is something Google has not been able to crck, despite being the top search engine in the country.
For Google, it will also help it take on Amazon by supporting Flipkart with the ‘right kind of tech push’.
As per the BS report, the tech giant is concerned about SoftBank’s decision on whether it will b exiting the firm or not, which would mean that the Flipkart-Walmart deal has not yet been completed. “Google wants the deal to fructify before it can take forward the discussion with Walmart,” BS quotes a source as saying.
ET reported earlier this month that SoftBank’s Masayoshi Son has not yet made a decision on whether to sell the 21% stake it acquired in Flipkart last year. It was reportedly examining the lax liability it may face for selling its shares in Flipkart in less than a year after investing. Moreover, the Walmart deal has taken Flipkart’s valuation to a whopping $22 billion, pointing towards the potential in Flipkart, especially from an investor point of view.
Walmart acquired 77% stake in Flipkart earlier this month for $16 billion. Walmart’s investment includes $2 billion of new equity funding. Walmart and Flipkart are also in discussions with additional potential investors who may join the round, which could result in Walmart’s investment stake moving lower after the transaction is complete.