Walmart exploring $10 billion Flipkart IPO: Report

Walmart exploring $10 billion Flipkart IPO: Report

Walmart Inc is reportedly preparing a $10 billion initial public offering (IPO) for e-commerce giant Flipkart in the US. 

The US retail giant has hired Goldman Sachs to assist with the listing, suggested the report, adding that Walmart is looking to sell around 25 percent of its shares in Flipkart, which is India’s largest online retailer.

“Work on the IPO is on in full swing and the advent of the pandemic has only hastened the process, given the spectacular surge in demand on e-commerce platforms,” one of two people was quoted as saying by the publication.

It is worth mentioning that if the IPO plan succeeds, it will be the largest by an India-based company on an overseas exchange. Moreover, Flipkart’s valuation is likely to double to $40 billion since Walmart had acquired a 77 percent stake in the e-commerce giant for $16 billion in 2018.

Earlier, news agency Reuters had reported that Flipkart will go public in 2021. As of now, Flipkart is valued at around $24.9 billion after a fresh round of funding in July, in which Walmart was the lead investor. So, Walmart now owns over 82 percent stake in Flipkart and the other key investors are Tiger Management, Tencent, Accel Partners and Microsoft Corp.

The IPO is expected to offer an opportunity for minority investors to sell or pare their holdings. Proceeds from share sell are likely to be used to expand Flipkart’s business, especially at a time when the e-commerce market is booming in India.