Two investors of Flipkart -- eBay and South Africa-based Naspers have decided to sell their entire stake in Flipkart.
US-based eBay on Wednesday said it plans to sell its stake in Flipkart for about $ 1.1 billion, and will relaunch eBay India focusing initially on cross border trade opportunity.
The statement by eBay came after Walmart Inc announced that it is buying 77 percent stake in Flipkart for about $16 billion, and also within a year of Flipkart acquiring eBay India.
"eBay has notified Flipkart and Walmart that it intends to sell its holdings in Flipkart, which will represent gross proceeds of approximately $1.1 billion," the eBay statement said.
Following the close of the transaction, eBay said it will also be ending the current strategic relationship with Flipkart, which includes unwinding commercial agreements with Flipkart and terminating Flipkart's licence to use the eBay.in brand.
"We plan to relaunch eBay India with a differentiated offer to focus initially on the cross-border trade opportunity, which we believe is significant. We believe there is huge growth potential for e-commerce in India and significant opportunity for multiple players to succeed in India's diverse, domestic market," the statement said.
Only last year, Flipkart group raised $1.4 billion from global technology majors eBay, Tencent and Microsoft.
In exchange of an equity stake in Flipkart, eBay had made a cash investment of $500 million and sold its eBay.in business to the Bengaluru-based e-commerce major, a PTI report said.
Meanwhile, South African Internet and entertainment firm Naspers sold its entire 11.18 percent stake in Indian e-commerce firm Flipkart to Walmart Inc for $2.2 billion, it said on Wednesday, Reuters said.
Naspers said the proceeds will be used to reinforce its balance sheet and will be invested over time to accelerate the growth of Naspers’ classifieds, online food delivery and fintech businesses globally. The firm also said it would also pursue other growth opportunities when they arise.
Launched in October 2007, Flipkart is India’s largest e-commerce marketplace. Naspers initially invested in Flipkart in August 2012 and its cumulative investment to the point of sale amounts to $616 million.
Updated Date: May 10, 2018 08:08 AM