San Jose-based e-commerce company eBay Inc has secured a 5.4% stake in Flipkart, according to US Securities and Exchange Commission (SEC) filings by the company.
The development occurred after eBay sold its Indian business to Flipkart for $211 million and made an investment of $514 million into Flipkart early this year. Flipkart has gained a profit of $167 million for eBay Inc, the filings stated.
In the filings, the US-based e-tailer stated, “During the third quarter of 2017, we received a 5.44 per cent ownership interest in Flipkart in exchange for our eBay India business and a $500 million cash investment, resulting in a cost method investment of $725 million.”
In August this year, Flipkart had completed the acquisition of eBayIndia. With this merger, Flipkart will provide Indian sellers to sell their products globally. Besides, the e-commerce giant is looking forward to sell refurbished goods on eBay platform.
In India, the sale of refurbished goods is currently dominated by OLX and Quickrand Amazon in a largely unorganized market.
Flipkart with this move not only aims to complete with these popular online retailers in India but also provide Flipkart’s vendors access to eBay’s global customers and Flipkart’s customers access to its global inventory of products.