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Last Updated : May 21, 2018 04:02 PM IST | Source: Moneycontrol.com

Google still considering Flipkart minority stake purchase

Google is examining the pros and cons of the deal and is concerned that SoftBank Group has not yet made a firm decision on whether or not it wants to exit Flipkart.

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Alphabet, the holding company of tech giant Google is yet to make a decision on acquiring a minority stake in Flipkart, according to a Business Standard report.

The company is reportedly still considering the pros and cons of the deal.

The development comes as Tiger Global and American retail giant Walmart are making efforts to get Google on board. Both the firms have held at least five rounds of discussions with Alphabet in a bid to convince it to buy minority stake in India’s most-valued e-commerce platform. The stake could be to the tune of between $1-$2 billion.

Walmart is trying to convince Alphabet that an investment in Flipkart would help it gain access to customer database of 175 million registered users. Google could benefit from the deal by studying the trends in user buying pattern so that it could be used to provide a more targeted search experience for users and push certain products accordingly, the report stated.

“Google, which has already access to user data, is still trying to figure out what Flipkart would bring to the table. However, it is still considering buying a stake in Flipkart as it is the principal opponent to Amazon in India and with the right kind of tech push it would be able to take on Jeff Bezos-led tech giant,” a source told the newspaper.

Google is believed to be concerned as the Flipkart-Walmart deal has not yet been completed with SoftBank Group still considering whether it wants to exit the firm or not.

On May 13, Walmart announced that it would buy 77 percent of online retailer Flipkart for $16 billion, as it made an elephant-footed entry into India’s exploding e-commerce market.

The remainder of the business will be held by some of Flipkart’s existing shareholders, including Flipkart co-founder Binny Bansal, Tencent Holdings, Tiger Global Management and Microsoft.

Walmart’s foray into India’s online retail space set the stage for an American business war against Amazon.com in the world’s fifth largest economy.

Walmart has approached fair trade regulator Competition Commission of India (CCI) for approval of its proposed acquisition of a majority stake in e-commerce major Flipkart, saying the deal does not raise any competition concerns.

Stating that the proposed acquisition would be done through its subsidiary Wal-Mart International Holdings, Walmart has told the regulator that Flipkart is a Singapore-based investment holding firm, which along with its direct and indirect subsidiaries, both in India and elsewhere, is primarily engaged in the business of wholesale cash and carry of goods and providing marketplace based e-commerce platforms to facilitate trade between customers and sellers in India.
First Published on May 21, 2018 09:57 am
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