Business and politics are alike. Actually, both are similar in many aspects. As far as adage goes, there is no permanent friends and foe in politics as well as business. Adages are adage because they always reflect their relevance from time immemorial.
As most of past relationships turn sour with the beginning of the more fruitful and reckoning one, Flipkart-Walmart deal also has turned a past friend into a foe.
With a $16 billion hefty investment, Walmart has taken over Flipkart. Following a few hours of the deal announcement, eBay called off existing ties with the Bengaluru-based company.
eBay has notified its intention to sell its ownership worth $1.1 billion in Flipkart. Importantly, it also heralds termination of Flipkart’s license to use the eBay.in brand. Six months ago, the SoftBank-backed company had acquired eBay in about $725 million.
While eBay pumped in $514 million in cash, its Indian subsidiary was valued at $211 million at the time of the merger with Flipkart.
The Devin Wenig-led company also signed a four-year exclusive commercial arrangement with Flipkart. However, such arrangements get shattered with Walmart acquisition. The difference between the two begun since Flipkart-Walmart engaged in advance talks for the acquisition.
Notably, it also announced a plan to relaunch Indian operations with an initial focus on cross-border trade opportunity.
The company’s reincarnation in the Indian e-commerce space won’t impact any serious player in the game.
Despite being the early mover in the country’s Internet commerce, it failed to make any significant dent. Many latecomers including Snapdeal and ShopClues outran eBay easily in the past.
While eBay is trying to carve a new beginning in India with Walmart-Flipkart cemented alliance, the decision hardly matters to the likes of Flipkart, Amazon and any other serious contender in one of the fledgling e-commerce markets in the world.
The development was reported by ET.