Amazon.com Inc may make a rival offer to buy Indian e-commerce firm Flipkart, which is in tie-up talks with Walmart Inc, local media reported, as the two US retail giants jostle for dominance in India's booming online industry.
Amazon held early exploratory talks to buy control of Indian rival Flipkart but a deal with Walmart is more likely, a news daily said on Wednesday, citing people with knowledge of the matter. One person familiar with the matter told Reuters that the probability of a deal with Amazon was low, and that any such deal could spark monopoly concerns as Flipkart and Amazon dominate India's e-commerce market. The person declined to be identified as discussions were private.
Amazon declined to comment when contacted by
Walmart-Flipkart deal
Walmart will buy a majority stake in Flipkart through a mix of primary and secondary share purchases in a deal that could value the Indian firm at $21 billion, a news daily reported.
Flipkart, founded by former Amazon employees Sachin Bansal and Binny Bansal in 2007, controls nearly 40 per cent of India's online retail market, ahead of Amazon, showed estimates by researcher Forrester. Like Amazon founder Jeff Bezos, the pair began by selling books and diversified rapidly, including by selling smartphones through exclusive flash sales. Flipkart now competes with Amazon on almost all product categories.
Flipkart's success has attracted a bevy of deep-pocketed and tech-savvy investors including US hedge fund Tiger Global Management LLC, online marketplace eBay Inc and software maker Microsoft Corp, as well as Chinese technology firm Tencent Holdings Ltd. It was valued at around $12 billion when Japan's SoftBank Group Corp's Vision Fund bought roughly a fifth of the firm last year for $2.5 billion.