Despite Amazon’s attractive offer, Indian online retailer Flipkart has chosen for Walmart and (remarkably), Google owner Alphabet as the new owners of 75 % of Flipkart’s shares. The deal is said to be worth 15 billion dollar.
Still some stumbling blocks
The acquisition has not been finalized yet: it should be done by the end of the week, but the conditions could still change (and therefore cancel the entire sale), according to insiders. Moreover, the Bureau of Competition still has to approve the deal, even though that may have been the biggest problem Flipkart's board had with Amazon’s bid: Bloomberg says that Flipkart’s board feared that the authorities would have blocked a deal between the number one and two in India.
An acquisition by competitors Walmart and Google would be a painful defeat for Amazon in India, after it had tried to tempt Flipkart last week with a generous offer. Analysts pointed out how important the world’s second most populated country could be for Amazon, after it already had to admit defeat in the world’s largest market: Alibaba and JD.com are insurmountable in China and Walmart is also a partial owner of the latter.
The move would also be a crowning achievement for Walmart as it banked everything on the Indian market. In order to generate enough money, it recently sold its British chain Asda to Sainsbury’s.