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Azim Premji Makes $130 Million in Flipkart Deal

18May By Sheldan RungasamyNo Comments

BUSINESS

Azim Premji Makes $130 Million in Flipkart Deal

The Walmart-Flipkart $16 billion acquisition must be the biggest fortune that could ever fall on investors in India’s largest e-commerce platform as they are set to receive their biggest payday. However, the e-commerce platform boasted international investors exclusively and therefore, Indians that will benefit from the $16 billion deal are only Flipkart founders and employees. However, one Indian investor will get around 420% returns on an investment he made 4 years ago in fashion e-commerce platform, Myntra, that was subsequently acquired by Flipkart. Indeed, the chairman of Wipro Limited and third richest man in India, Azim Premji is going to receive $130 million from his $25 million investment in Myntra thanks to the acquisition of Flipkart by Walmart, according to two people bri...

Foxconn Unit Put Downs Another $40 Mn Investment In Snapdeal

15May By Lavina TolaniNo Comments

BUSINESS

Foxconn Unit Put Downs Another $40 Mn Investment In Snapdeal

While foreign investments have been raining in Indian e-commerce marketplace, Foxconn Technology Group has announced another write off of an additional $40 million of its $200 million in e-commerce company Snapdeal. Earlier in August 2017, FIH Mobile had written in its annual report that its entire $200 million investment in Jasper Infotech ( Snapdeal owner and operator) cannot be recovered. Moreover, Foxconn had registered impairment loss of around $160 Mn for its investment in Jasper Infotech for six months and the loss period ended June 30, 2017. FIH Mobile, The subsidiary of world's largest contractor Foxconn has forecasted that the recoverable amount from its investment in Jasper Infotech is $3 Mn while citing the failed merger between Flipkart and Snapdeal as being one of th...

The New ESOP’s Offer for Flipkart Employees Revealed !

15May By Lavina TolaniNo Comments

News

The New ESOP’s Offer for Flipkart Employees Revealed !

E-commerce Unicorn Flipkart has announced a repurchase ESOP's offer for its employees at a share price ranging from USD 125-129. The offer from the Bengaluru headquartered company comes in the wake of the completion of company's acquisition by US retailer Walmart for roughly USD 16 billion. According to one of the sources familiar with the matter, Flipkart will allow employees, present as well as former to liquidate part of their vested options. This will enable current employees to vest up to 50 percent of their stock options now followed by 25 percent in the second and third year. The transaction price would be in the range of USD 125-129 per option. As far as former employees are concerned, they can vest up to 30 percent of their ESOPs. A company spokesperson also added that the e...

This is Why SoftBank is Reluctant to Sell its 22 % Flipkart Stake

15May By Lavina TolaniNo Comments

News

This is Why SoftBank is Reluctant to Sell its 22 % Flipkart Stake

Post mega Flipkart-Walmart Acquisition, the e-commerce world has been buzzing with speculations all around as to how the mammoth deal will shape the coming scenario. Now, there is a new dimension that has come into play regarding SoftBank unwilling to sell its stakes to Flipkart. If SoftBank was to sell its 22.3% stake in Flipkart Singapore to Walmart now or anytime before August 2019, it may have to hand over a massive $600 million to the Indian taxman out of its profit of $1.5 billion. Just 9 months ago in August 2017, the Japanese multinational conglomerate, SoftBank had announced its investment of $2.5 billion in Flipkart Singapore via SVF Holdings. Understanding the Taxation Dynamics Right after the official announcement, more than 500 funds were set up...

I-T dept to Seek Share Purchase Pact from Flipkart

14May By Lavina TolaniNo Comments

News

I-T dept to Seek Share Purchase Pact from Flipkart

The Income Tax department will seek purchase agreement from Flipkart on the mega e-commerce USD 16 billion buyouts by US retail mammoth Walmart to assess the tax liability and also find out whether the General Avoidance Rule provisions can be invoked as informed by an official related with the matter. The department id presently is referring to Section 9(1) of the Income Tax Law, which deals with the indirect transfer provisions to seek if the benefits under bilateral tax treaties with countries like Singapore and Mauritius could be availed by foreign investors such as Walmart. Singapore registered Flipkart Pvt Ltd has majority stakes in Flipkart India. Post definitive agreement between the companies, Walmart will hold 77 percent stake in the Singapore entity for USD 16 billion. The ...

Walmart Planning to Launch Flipkart’s IPO in Next 4 years

13May By AnkitaNo Comments

News

Walmart Planning to Launch Flipkart’s IPO in Next 4 years

US retail giant Walmart Inc mentioned in its report to US security exchange that they may come up with an initial public offer (IPO) of Flipkart as early as four years. Walmart in its report said IPO will be at "a valuation no less than that paid by Walmart under the share issuance agreement, subject to the satisfaction of certain other conditions regarding such offering (the IPO)". Which means Walmart can issue the shares of Flipkart at the valuation of $16 billion that it paid to other investors of Flipkart to acquire the 77% shares of Flipkart. Also, the report added, "Shareholders agreement would expire upon the consummation of the IPO, whether initiated by the board or the minority stockholders". "Pursuant to a Registration Rights Agreement to be entered into concurrently wi...

11May By Lavina TolaniNo Comments

News

Walmart to Open 50 New Stores in India in Next 4-5 yrs

Just after a day of officially announcing the $16 billion dollar deal in India's largest e-commerce unicorn Flipkart, Walmart Inc on Thursday has said that it will continue to grow its wholesale cash-and-carry business by adding 50 new stores in the next four-five years. US mammoth Walmart which so far had been handicapped by India’s retail policy that does not allow overseas companies to sell directly to consumers will now have an online presence, all thanks to Flipkart. Walmart India President and CEO Krish Iyer said, We currently have 21 stores and plan to open 50 stores in 4 to 5 years. Plans are on track. We have a pipeline of 20 stores and we expect to open 5 stores in the current year and then pick up the pace and eventually start opening 12-15 stores a year. Meanwhile, Doug...

SoftBank Undecided on Selling its 22% Stake in Flipkart

11May By Press Trust of IndiaNo Comments

News

SoftBank Undecided on Selling its 22% Stake in Flipkart

New Delhi: SoftBank founder Masayoshi Son yet not decided to sell its 20-22% stake in Flipkart to Walmart Inc., sources close to the company told to Pixr8 News. After seeing the valuation of the company, Masayoshi Son is in dilemma and will take a call in the next 7-10 days on whether to exit India’s biggest online retailer or stay invested for a long time. If SoftBank decides not to sell its stake then Walmart left with about 55% stake of Flipkart. All other significant shareholders like Naspers, venture fund Accel Partners and eBay had confirmed selling their shares in Flipkart to Walmart. Though on Wednesday, Us retail giant Walmart Inc has announced that it will pay about $16 billion to buy 77% stake in Flipkart. A statement issued by Walmart identified Flipkart co-founder Binny B...

World’s Biggest E-Commerce Acquisitions At A Glance

11May By Lavina TolaniNo Comments

ANALYSIS

World’s Biggest E-Commerce Acquisitions At A Glance

The deal is done and we are still digesting the news: Walmart. Inc has officially acquired Flipkart for $16 billion in a deal that soared the valuation of Indian e-commerce platform to over $20 billion, making it the biggest e-commerce acquisition ever globally. The brick-and-mortar company acquired 77% of the Indian e-tail business. While the world is going gaga over Walmart Flipkart Acquisition, we want to bring your attention to other behemoth acquisitions that have shaped e-commerce landscape in the manner we know of it today. Chewy-PetSmart ( $3.35 billion) Last Year, US E-commerce Giant Chewy which majorly deals in pet food and other pet-related products acquired a retailer mammoth PetSmart for whopping $3.35 billion. This was considered the world's bigge...

Flipkart CEO confirms sellers about no change in operating processes

11May By Lavina TolaniNo Comments

News

Flipkart CEO confirms sellers about no change in operating processes

While the world hasn't got over with mega e-commerce acquisition of leading giants, Flipkart CEO Kalyan Krishnamurthy has reached out to sellers on its platform reassuring that there will be no changes in the operating process of Bengaluru based firm post $16 billion acquisition deal with US retail major Walmart. Krishnamurthy has said that the company will continue to focus on making sellers succeed adopting the "same vigour as in recent years". Flipkart and Walmart will maintain distinct brands and operating structures post the investment, the CEO said while reinforcing that Flipkart will continue to remain a marketplace where sellers from around the country can connect with customers. The Bentonville, Arkansas-based retail mammoth Walmart Inc took the world to storm after it of...

Walmart Raises $5B Revolving Credit to Fund Flipkart Acquisition Deal

11May By Lavina TolaniNo Comments

News

Walmart Raises $5B Revolving Credit to Fund Flipkart Acquisition Deal

A number of monetary corporations including JPMorgan Chase and Barclays are offering $5 billion financing to Walmart that will help the American giant fund its $16 billion acquisition of Indian e-commerce unicorn Flipkart. The credit line involved would be one of the largest revolving credit facilities in the recent times as it is priced between 300-400 basis points over London Interbank Offered Rate. The facility amount will be secured against the balance sheet of Flipkart and its shares will have a tenure of 18 months. The proposed revolving facility is an arrangement that allows buying company to facilitate the immediate acquisition financing requirements while the loans are secured against the balance sheet of the target company of its share price. "Walmart has very strong ban...

These Flipkart Employees Become Instant Millionaire After Walmart Deal

10May By Sheldan RungasamyNo Comments

News

These Flipkart Employees Become Instant Millionaire After Walmart Deal

While most Indians reacted with contempt to the news of the acquisition deal of Bengaluru-based Flipkart by Arkansas-based retail giant Walmart, many Flipkart employees must be in the seventh of heavens right now. Indeed, after the $16 billion acquisition for 77% stake, several employees are set to become millionaires from the deal as large payouts in the form of Employee Stock Option Plan (ESOP) since the company’s valuation raised from $15 billion to $20 billion. Speaking before the acquisition deal was confirmed, a Flipkart employee said, If this deal materializes, it will give a strong value to the concept of ESOPs, something that other startups may like to emulate. They will have the hope that even their companies will have an IPO or get big investors and give them a chance to ...