The Competition Commission of India (CCI) might recommend structural changes to the proposed $16-billion Walmart-Flipkart deal to address possible competition concerns, according to officials.

It might also take cues from a ruling in South Africa with respect to the Walmart-Massmart deal, which was announced in 2010.

Last month, Walmart Inc announced the acquisition of a 77 per cent stake in Flipkart for about $16 billion (₹1.05 lakh crore) in the largest-ever e-commerce deal. The retail giant has approached the CCI for approval, saying the deal does not raise any competition concerns.

However, various trade organisations have opposed the deal.

While the CCI is yet to take a call on the Walmart-Flipkart deal, officials said the regulator might order certain structural changes in the proposed transaction to address possible competition concerns. Walmart declined to reply to queries on this.

 

Officials said the CCI might take a cue from the South African example and might even recommend the setting up of a long-term fund to modernise kiranas going forward besides supporting local manufacturing by SMEs.

The fund could work under the aegis of the Department of Industrial Policy and Promotion along with Walmart representatives to build a robust kiranas development programme wherein the US retailer provides knowledge and resources, they added.

The Competition Commission of South Africa had approved the deal between Walmart and Massmart, but it was challenged later. Subsequently, that country’s Competition Tribunal gave its approval in 2011 for the merger subject to conditions proposed by the two companies.

 

 

Related Topics