Soft-Bank, has been willing to invest about $4 billon afresh into the Indian e-commerce leader, if it pursued an alternate merger with arch-rival Amazon, sources close to the matter told.
It also marks a shift in Walmart's traditional approach of building a business on its own.
The American brickand-mortar retailer, Walmart, is seeking a route to a majority in one of Indias largest online marketplaces, valuing it at around $20 billion.
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According to Quartz, which cited data from 7Park Data, as of April, Amazon's market share in India stood at 44%, down from 50% at the start of the year, but still ahead of Flipkart, which controls about 40% of the market, Quartz reported.
All this aside, another source said that the Flipkart board already agreed to Walmart's offer a few days ago, thereby possibly thwarting Amazon's intention to sweep in and win the game.
Walmart has entered the final leg of negotiations to buy a majority stake in Flipkart. The e-commerce player had spent about $1 billion to acquire part of equity held by large investors including Tiger Global and Accel India.
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Most Flipkart shareholders also preferred a cashout deal as against a shareswap with Amazon. It also is offering a $2 billion breakup fee. Softbank, Flipkart's main stakeholder, however, had some apprehensions over a deal with Amazon. The company led by Doug McMillon has spent months negotiating with the online marketplace and its large backers, including SoftBank's Vision Fund, which invested previous year.
"Now with Walmart in the mix things are different", the source said.
SoftBank, Flipkart and Amazon did not comment on the development. Flipkart and Amazon dominate the online shopping space in Asia's third-largest economy. India's leading e-tailer, besides, has been looking to open retail stores in India for a long time now but has been waiting for the right investment partner. At that time, Flipkart had also raised funds from eBay, Tencent Holdings and Microsoft Corp.
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Whereas in a Public company, the number of shareholders can be more than 50. It added that Walmart still remained the front-runner in the deal as Flipkart investors Tiger Global, Naspers as well as founders Sachin Bansal and Binny Bansal prefer Walmart over Amazon.