Amazon offers to buy 60% of Flipkart for $2 billion

Ahead of Walmart deal, Flipkart keeps $400 million aside to cut number of shareholders in Singapore: Report

According to a report by CNBC TV18, Amazon has made a formal offer to buy a 60% stake in Flipkart at a price which is believed to be similar to Walmart's offer - around $12 billion.

- CNBC-TV18 also reported that Amazon had offered Flipkart a breakup fee of $2 billion to convince it to discuss an offer.

Ecommerce major Amazon has offered to buy 60% stake in Flipkart. The offer could complicate matters for Walmart, which has also been trying to buy a majority stake in the company.

Amazon is also reportedly seeking a non-compete agreement with Flipkart's founders of somewhere between one and two years.

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Amazon had made an offer for a 51% to 55% stake in Flipkart in 2016, but the company vetoed the deal, people familiar with the matter told Reuters. Talks between Walmart and Flipkart have been on for months now and the deal was expected to close soon.

Though Amazon's interest in Flipkart is unconfirmed and could just be sly negotiating tactics by either side, any show of insecurity would be surprising.

For Amazon, throwing its hat in the ring could be as much about derailing Walmart's efforts as it would be about defending its 27 percent market share in India, consultants and investors said.

Walmart-Flipkart deal may be at its closing stage.

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Last month Bloomberg reported the Bentonville, Arkansas-based retailer was likely to emerge as the victor of the bidding war with it offering around $20 billion.

The Flipkart deal would also propel the Bentonville, Arkansas-based retail behemoth to hasten its online expansion into remaining Asian markets, the sources added. This is where SoftBank suggested that it was open to investing another $3-4 billion in Flipkart, which would be deployed to buy shares from smaller investors and help it maintain around 20% stake in the combine with Amazon.

Amazon is the second-largest e-commerce player in India and Flipkart's primary rival. As for why both US retail giants want a piece of Flipkart, India's e-commerce market is expected to be worth $200 billion annually in the next 10 years. What the shareholding pattern is or what the structure of the deal is not known as yet. The buzz is that the American company could bag four of the 10 seats on the board but the top management is not expected to change.

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