A top executive at Bentonville based Walmart said an initial public offering (IPO) for ecommerce arm Flipkart is under active consideration in order to unlock value for the Bengaluru based company and its customers. No timeline has been set yet for the IPO.
“We have talked about the potential of an IPO. I think it’s something that is still certainly on our minds and I think it could make sense to be a public company and have your associates have that -- the ability to own shares in a company and do things like that like we have in Mexico,” said Brett Biggs, executive vice president and chief financial officer at Walmart.
Briggs was speaking at the Baird 2021 Global Consumer, Technology and Services Conference on Wednesday.
“So, I think we are open to all kinds of different structures in India. But IPO is something that we certainly have been considering,” he said, adding that Walmart was open to different kinds of ownership structures in India.
Earlier this week, president and CEO Judith McKenna said during the DbAccess Global Consumer Conference that while the American retailer was open to an IPO for Flipkart, it hadn’t set a timeline for the same. She also said that while Flipkart was doubling down on high margin segments such as fashion, a key investment area for the company would be wholesale business directed at small and medium businesses as well as the nascent grocery business.
“Grocery penetration in India is massively low, accelerated through Covid. We are just expanding our office there and it’s one of the few areas where Walmart can really help and support in terms of the learning for working with that,” said McKenna.
VCCircle recently reported that SoftBank from its Vision Fund 2 is in line to invest $700 million in Flipkart at a valuation of $30 billion ahead of the company’s proposed IPO. Flipkart was valued at nearly $25 billion following Walmart’s recent fund infusion into the company. The proposed deal will also make it SoftBank’s second bet in Flipkart as the Masayoshi Son-led fund had previously invested $2.5 billion in Flipkart in 2017 and later sold all of its 20% stake in the company to Walmart a year later.