While it is being speculated that Walmart may retain the top management of the company after the acquisition goes through, it is also being said that the two founders - Sachin Bansal and Binny Bansal - are looking to sell their entire stake in the company.
The report further states that Walmart will spend at least $14.6 billion in cash, with the rest expected to be in the form of stock.
The under-works $12-billion Flipkart-Walmart deal has left merchants selling products through the e-commerce platform jittery as they claim to be clueless about the ongoing negotiations and its possible impact on their business.
Flipkart has bought back shares worth $350 million from several minority investors, including DST Global, IDG Ventures and ICONIQ Capital, as India's most valuable internet start-up prepares to sell a majority stake to Walmart Inc. According to a recent Economic Times report, Flipkart's Executive Chairman Sachin Bansal may exit Flipkart, once Walmart enters.
In December past year, Flipkart Ltd, the Singaporebased parent entity of the Indian e-commerce giant, had bought back shares worth close to $800 million from investors including Tiger Global, Accel Partners, and DST Global. Walmart also plans to develop a grocery marketplace using Flipkart.
Alphabet Inc. may be contributing $3 billion to the investment.
Walmart would maintain a focus on the grocery market, said the sources, suggesting that nearly 50% of Walmart's initial investment would be funneled into building a food and grocery supply chain.
World's largest retailer Walmart has finally made a decision to acquire Flipkart. Sources said Amazon's deal included a $2-billion breakaway fee in case the deal did not go through because investors and Flipkart cofounders are anxious that the deal will run into regulatory hurdles.
"The stakes are really high for Walmart", said Brian Yarbrough, senior research analyst with Edward Jones.