Crown for Indian e-commerce market would now be fought between old local foes – Amazon and Walmart. With later acquiring about three-quarters of the Bengaluru-based marketplace, Flipkart would be a subsidiary of the Doug McMillon-led global retail major.
Since Walmart is mere centimeters away from acquiring Flipkart, Amazon has poured in $400 million (Rs 2,600 crore) in its marketplace arm – Amazon Seller Services. While the fresh infusion could only be a coincidence, it certainly adds some fuel to an ongoing frenzy.
RoC filings reveal that the fresh funding resolution was passed in the last week of April. So far, the Jeff Bezos-led online retail conglomerate has invested about Rs 20,000 crore in the marketplace arm.
In its largest round ever, Amazon had made a $450 million (Rs 2,900 crore) infusion in the marketplace unit in November last year while it further recharged the wholesale concern with an additional $300 million (Rs 1,950 crore) in January this year.
Surpassing its $5 billion commitment to Indian play, Amazon had increased share capital from $2.4 billion to $4.8 billion.
Indian e-commerce poster child Flipkart has been engaged in an intense battle with Amazon that had kicked-off its operations in the middle of 2013. Interestingly, barging Walmart-Flipkart negotiation, the US-based giant also offered a buyout deal to the SoftBank-funded company.
Last week, Flipkart board had reportedly approved the buyout of 75 per cent equity to Walmart for $15 billion.
The company’s co-founder Sachin and Binny Bansal are likely to exit while its chief executive Kalyan Krishnamurthy also likely to move from the company this year.
During FY17, Amazon Seller Services, which earns through commissions, advertisements and shipping fees, registered a growth of 41 percent with a revenue of $481 million (Rs 3,128 crore).
The face of horizontal e-commerce is going to see some major shift in coming months and year as Walmart would now be steering Flipkart. Leaving Snapdeal and ShopClues far behind, Amazon has emerged as only strong competition to the local giant.
The development was first reported by ET via RoC filings.