News digest Walmart Flipkart bid NCLT Binani row EPFO hack and more

News digest Walmart Flipkart bid NCLT Binani row EPFO hack and more

News digest Walmart Flipkart bid NCLT Binani row EPFO hack and more

According to a CNBC TV18 report, the US-based e-tailer has made a formal offer to buy a 60% stake in Flipkart on Monday. But this week, according to a report by CNBC affiliate CNBC-TV18, Amazon has tendered a competing offer-complete with a $2 billion "breakup fee" to cover the cost of a potentially scuttled deal.

Walmart's urgency to stem market share losses to rivals like Aldi or Amazon has also seen it launch talks to merge its United Kingdom arm ASDA with J Sainsbury, in which it will hold a minority stake. Flipkart founders Sachin and Binny Bansal are also said to have favoured Walmart.

Amazon's bid may complicate matters for Walmart, which has also been trying to buy a stake in Flipkart. Amazon is also seeking a noncompete agreement with Flipkart's founders, the report said, adding that Walmart has added no such stipulation in its offer to acquire an 80 per cent stake in the company. Talks with Walmart are ongoing, and a deal is expected to be agreed soon, the news agency reported on May 2.

Talks of Amazon making a counterbid to pick up stake in Flipkart have been doing the rounds for a while now. Amazon's bid is likely to be on par with Walmart's bid for the Indian e-commerce company, CNBC-TV18reported. That's before Amazon made its entry into this market, Walmart's deal with Bharti was called off in 2013 when Amazon was well established in India.

Legal experts say a Walmart-Flipkart deal will invite lesser questions and complications as compared to an Amazon-Flipkart deal, in particular with respect to the CCI.

Flipkart has also been negotiating a deal with Walmart, the $500-billion multinational retail chain which is ranked as the world's largest company by revenue, and has been looking to establish a footprint in India. The private company status will further ease the process of one of the biggest deal in Indian e-commerce history.

The deal would be the USA retail giant's biggest acquisition of an online business and would kick off a battle with Amazon in an Indian e-commerce market that analysts forecast will be worth $200 billion a year within a decade.

Anyway, Flipkart's investors and founders are leaning towards Walmart's bid and the Sachin Bansal (Flipkart's founder) has already been in the United States to negotiate with Walmart's execs. Tiger Global and SoftBank are largest shareholders in Flipkart, holding 20% each in the company.

Flipkart's board had appeared to be leaning toward Walmart over Amazon because it thinks the deal will have fewer hurdles. The Amazon bid, the person said, is pegged at $22-23 billion.

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