Flipkart considered selling itself to Amazon, a chorus of voices in the investment community told ET, upending conventional thinking that India’s largest online retailer would go the full distance as an independent Internet giant. In all, half-a-dozen sources told ET of the discussions between Flipkart and Amazon, and emphasised there is no reason to believe that a deal will be struck or that talks are still ongoing between the two. The talks were held until as recently as the last quarter of 2015, one of the sources said. ET was not able to determine the exact timeline of these talks or if they were initiated by one of Flipkart’s investors. Flipkart itself denied that it is up for sale, or that it is in the market for capital. Binny Bansal, the chief executive officer of the Bengaluru-based company, said in a statement that Flipkart would raise money only at the right valuation. “All rumours of potential sale and down rounds are false and baseless,” said Bansal, who took over as CEO in January, succeeding cofounder Sachin Bansal, who is now the executive chairman of India’s most valuable startup. “Flipkart continues to be the market leader in India and we are in this business for the long haul.” He did not directly address specific questions about talks with Amazon. Amit Agarwal, the head of Amazon in India, did not reply to emailed questions. A spokeswoman for Tiger Global Management, the largest shareholder in Flipkart, declined to comment. Sachin Bansal and Binny Bansal own about 7% stake each in Flipkart. MAJOR DEVELOPMENT With or without a deal, the fact of negotiations involving potential sale of Flipkart is a major development for two reasons — it radically alters the narrative about online retail industry in India, and raises questions about willingness and ability of Indian startups to fight and win prolonged battles for market domination.
Source: Economic TimesTwist in startup tale: Flipkart and Amazon may have explored sale talks, say sources.
Industry: Other 2016-03-16
