HomeRetail NewsFlipkart-Walmart deal a "watershed moment" for Indian startups, says Binny Bansal

Flipkart-Walmart deal a "watershed moment" for Indian startups, says Binny Bansal

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By Shereen Bhan  July 9, 2018, 9:23:29 AM IST (Updated)

Flipkart group chief executive Binny Bansal said the $16 billion deal with Walmart was a "watershed moment" for Indian startups, and that it was validation for investors who had taken a bet on India.



The Flipkart co-founder, who will continue on the board, said Walmart's global expertise would help the business grow further, and eventually set the company up for a public offering.

Walmart chief executive Doug McMillon said there is a lot of upside to the acquisition of Flipkart and is keen to add value to the business post the deal with India’s biggest e-commerce website on Wednesday.

The US retail giant said India was one of the growth markets for the company, and that capital was not a constraint for this investment, which is now one of the biggest foreign direct investments in India.

“The deal is a validation for investors who have bet on India and the culture of Flipkart has been to take bold bets and that will continue,” Bansal said, adding that it is a huge moment for India and India’s startup space.

Binny Bansal expects to maintain the Flipkart culture and retain the brands that it is associated with.

McMillon said Walmart’s board has identified businesses and geographies, including US, Canada, Central America and China, believing that the opportunity is large and is keen on adding value to the business.

“In China we run a brick and mortar business and have also invested in e-commerce. Globally the customers want a mix of traditional retail and e commerce,” McMillon added.

The current CEO of Flipkart, Kalyan Krishnamurthy added that there are still some gray areas in the grocery delivery business which needs to be solved and with Walmart on board, it will help scale the business further and expand to 4-5 different cities.

“Short term growth will be on accelerating growth while long term focus will be on synergies,” Bansal said.

McMillon added that it will help Binny Bansal and its team and work with the regulatory authorities with the smooth transaction of the deal.  The company is positive about tax liability not being a huge issue in the deal.

The investment made in Flipkart will have few losses but is a compelling opportunity in the long term, McMillon said.

Binny Bansal said, “Sachin Bansal made Flipkart synonymous with e-commerce in India. This is a great time to celebrate what Sachin has done to build Flipkart.”

On Wednesday, Walmart and Flipkart signed a deal where Walmart will acquire 77% stake in Flipkart for about $16 billion as it competes with Amazon.com Inc in an important growth market.

Also Read: Key highlights of the $16 billion Walmart-Flipkart deal

Read our comprehensive coverage of the deal here.

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