Walmart Beats Amazon in the Flipkart Battle
Hours before Walmart Inc. was scheduled to unveil the largest acquisition in its history, Masayoshi Son, chief executive officer of SoftBank Group Corp., spilled the beans to a roomful of investors and journalists in Tokyo. He confirmed that the U.S. retailer has agreed to buy control of Flipkart Online Services Pvt, the leading Indian e-commerce player backed by SoftBank.
Walmart announced the deal later on Wednesday.
After his initial comments, Son noticed a sheet of paper that had been left on the podium for his attention. He picked it up and smiled.
“Oh, I see here that the Flipkart-Walmart deal isn’t fully confirmed at this point in time,” he said to the laughing audience. “Yabai desune,” he added, which translates in Japanese roughly to “Oops” or “That’s not good.”
Flipkart, India’s biggest online retailer, is a key part of Walmart’s efforts to expand in the country and strike a blow against Amazon.com Inc. in the world’s second-most populous nation.
The deal -- which may be the biggest ever in e-commerce -- gives Walmart greater access to an Indian e-commerce market that Morgan Stanley has estimated will grow to $200 billion in about a decade. Flipkart, meanwhile, gets additional capital and expertise to battle Amazon, which has spent billions of dollars to gain customers in India. Online sales are growing about 35 percent a year, according to data tracker Euromonitor, fueled by a rising middle class and urbanization that present an attractive environment for e-commerce.
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