Walmart's $16B Deal To Buy Indian E-Commerce Platform Latest Parry Against Amazon
Last week Walmart inked a $16B deal to buy a majority stake in Flipkart, India’s major e-commerce platform. The move, which had been in the works for quite a while, is the latest in the Arkansas-based retail giant's long worldwide game against online rival Amazon, the New York Times reports.
The deal puts Walmart in direct online competition with Amazon in the Indian market, which is growing rapidly. It isn't clear whether Walmart, which has had mixed results in the online realm, can halt Amazon's inroads into India.
Walmart has a lot to bring to the table when it comes to Flipkart. The retailer could invest another $3B into Flipkart beyond the purchase price, Quartz Media reports.
Approval by Indian regulators isn't a foregone conclusion. Swadeshi Jagran Manch — an affiliate of the Hindu nationalist association, Rashtriya Swayamsevak Sangh, which has close ties to India's ruling party — has come out against the deal, the Indian publication Business Today reports.
Whatever the outcome of the deal in India, Walmart is on a worldwide hunt to expand in the face of Amazon.
Last year, Walmart bought ModCloth, a womenswear retailer that focuses on a younger demographic, as well as Bonobos, an e-commerce-focused apparel company that designs and sells men's clothing.
Walmart also bought last-mile delivery startup Parcel Inc. in a move clearly aimed to take on Amazon, Reuters reports.
"We plan to leverage Parcel for last mile delivery to customers in New York City — including same-day delivery — for both general merchandise as well as fresh and frozen groceries from Walmart and Jet," Wal-Mart said in a posting about the deal.
Early this year, Walmart formed a partnership with Rakuten, a Tokyo-based global internet services company that started as an online marketplace but later expanded into fintech and digital content. The collaboration includes the launch of a new online grocery delivery service in Japan beginning in Q3.