Top trio at Flipkart to resign post Walmart deal?

Amazon halts its construction in Seattle

In a move seen as a precursor to United States retail giant Walmart acquiring a majority stake in Flipkart, the Indian e-commerce player has bought back shares worth $350 million from investors in its Singapore-based parent to regain private limited status in the country. According to a Bloomberg report, Flipkart Online Services Pvt has approved 75 per cent stake sale to Walmart for $15 billion.

Walmart informed Flipkart it plans to sell shares in an initial public offer (IPO) in three years time. Google's parent company Alphabet Inc.is said to be participating in the deal with a $3 billion investment.

India is a critical market for both Walmart and Amazon and a deal with Flipkart would help either player in consolidating their position in the booming e-commerce market here.

Walmart is likely to buy stakes of multiple Flipkart investors, including that of Tiger Global Management and Softbank, to end up with at least 60 percent holding and the deal could be announced in the coming days, according to sources.

The decision came a week after Flipkart bought back about 1.9 million preference shares worth a total of $350 million from various minority investors including DST Global and IDG Ventures in a transaction that closed April 27.

While CEO of Flipkart Kalyan Krishnamurthy will reportedly continue in his position, reports also said that co-founder Sachin Bansal may quit. India-based website BGR.in reported cofounder Binny Bansal might remain in some capacity as Walmart wants to retain only one of the founders.

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The talks with Walmart for what could be its largest acquisition to date are still ongoing, and a deal is expected to be clinched soon, two people told Reuters on Wednesday.

"Walmart may look at bringing in its own private labels via Flipkart to the Indian consumers".

The world's largest online retailer has been pouring billions of dollars into India to ship goods to shoppers faster, contributing to growing losses internationally.

Walmart is now seeking a bigger stake than previously expected. Some sources have said that Flipkart is valued at over $20 billion. Krishnamurthy, who took over as CEO from Binny in January last year, is seen to have turned around the e-commerce major after two sluggish years when it ceded market share to Amazon under the leadership of Sachin.

Walmart shares closed 0.13 percent lower Thursday on the New York Stock Exchange, while Amazon stocks closed higher by 2.39 percent on Nasdaq.

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