In a significant move, Walmart has paid $1.4 billion to acquire Tiger Global’s remaining holdings of Flipkart shares, solidifying its position as a major stakeholder in the Indian e-commerce startup. The transaction, completed in recent days, showcases Walmart’s continued expansion in the Indian market.
Tiger Global’s Impressive Returns on Flipkart Investment
Tiger Global, which had previously cashed most of its Flipkart shares, has made a remarkable return of $3.5 billion on its initial investment of $1.2 billion, according to a source familiar with the matter. The New York-headquartered hedge fund shared this information with its investors. The Wall Street Journal was the first to report on this deal.
Flipkart Valued at $35 Billion in Secondary Shares Sale
The secondary shares sale has valued Flipkart, headquartered in Bengaluru, at $35 billion. Notably, the company was valued at $37.6 billion in a funding round in 2021. However, it has since internally adjusted its worth by approximately $5 billion following the division of payments startup PhonePe.
Walmart Investment in Flipkart
Walmart’s investment in Flipkart dates back to 2018 when it acquired a 77% stake in the company for $16 billion. As of last year, Walmart held a 72% share in Flipkart, while Tiger Global had a 4% stake prior to the recent transaction.
Flipkart Eyes Additional Funding
Despite past fundraising efforts, Flipkart has largely depleted the capital raised in 2021. Consequently, the company is now seeking another round of funding. While gauging market interest in recent months, the company has not struck a deal due to a lower valuation. It is likely that Flipkart will turn to Walmart to secure the majority of the financing required for its next round of funding.
India’s OTT market is expected to grow to a market size of $12.5 billion by 2030, which will keep the funding faucet open for Flipkart, offering significant opportunities for the e-commerce giant in the future.
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