Earlier this 12 months, funding agency Tiger International was considering divesting its stake in Flipkart, India’s e-commerce big. Now, the agency has efficiently exited the corporate by promoting its remaining shares to Flipkart-parent, Walmart. This transfer comes virtually a 12 months after Tiger International decreased its investments in Indian start-ups by greater than one-third, and in addition marks one of many greatest exits globally, that Tiger had pocketed.
First reported by WSJ, Walmart has paid a complete of $1.4 billion to amass the remaining holding of Flipkart shares, permitting the New York-based Tiger International to exit with income of $3.5 billion on its funding within the homegrown e-commerce agency. Studies additional state that Tiger International knowledgeable its restricted companions (LPs) that it bought its remaining stake of 4% in Flipkart to Walmart final week. The US-based funding agency had initially put in $8.6 million into Flipkart’s Sequence B spherical in 2009, earlier than including a further $1.2 billion between 2010-15.
A spokesperson for Walmart confirmed the event, though they declined from commenting on the monetary particulars of the deal. The Wall Road Journal experiences Walmart’s acquisition of Tiger International’s stake has resulted in Flipkart being valued at $35 billion, down from its earlier valuation of $38 billion throughout a earlier fundraising spherical of $3.6 billion two years in the past. The corporate had additionally adjusted its valuation following the separation of Flipkart and PhonePe into two distinct entities final 12 months.
This marks the most recent occasion of Tiger International promoting a part of its stake within the Indian e-commerce main. Six years in the past, it bought a part of its Flipkart stake to Japan’s SoftBank Group, and a 12 months later, bought one other a part of its stake to Walmart. Total, Tiger nabbed a complete of almost $5 billion from the proceeds from the sale of its shares in Flipkart. Flipkart stays the one Indian startup which acquired an funding of over $1 billion from America’s Tiger International.
“We’re grateful for our partnership with the Flipkart workforce and for the chance to put money into the corporate by way of early chapters in its development,” Tiger International stated within the letter to its LPs. The distribution particulars of Tiger’s income shall be supplied within the coming weeks.
For Walmart, this acquisition gives a stronger foothold in Flipkart and permits the retail big to solidify its presence within the Indian client market. India’s client class at the moment includes 473 million people, second solely to China’s huge client base of 899 million. The post-pandemic period has witnessed important development in India’s client durables market, which is projected to double inside 4 years, reaching $21.2 billion, from its earlier worth of $9.85 billion two years in the past.
For many who want a reminder, Walmart first paid a complete of $16 billion to nab a stake of 77% in Flipkart, whereas Tiger International’s stake within the Indian agency amounted to 4% (previous to the current sale). Concurrently, it additionally purchased the stake of VC agency Accel, which is one other long-time backer of Flipkart – a stake of 1.2% – in Flipkart. Market intelligence agency Tracxn experiences that Walmart held an general share of 72% within the Indian agency as of final 12 months. “We stay assured in the way forward for Flipkart and are much more constructive in regards to the alternative in India at present than once we first invested,” a spokesperson for Walmart commented on the matter.