Flipkart has concluded another buyback of shares from investors, a move that is likely aimed at paving the way for U.S retail giant Walmart’s stake acquisition, according to Vivek Durai, founder at business intelligence platform Paper.vc.
The buyback appears to be a procedure aimed at converting the e-commerce firm into a private company under Singapore law.
“This buyback and the subsequent conversion to private company status appears to be the first phase in a transaction aimed at easing a proposed acquisition by Walmart,” said Mr. Durai. “It also places Flipkart’s valuation at approx $17.69 billion.” The company paid a set of investors $350.46 million to buy back 18,95,574 preference shares in a transaction that closed on April 27, 2018, according to regulatory documents filed by Flipkart with the authorities in Singapore and which were sourced from Paper.vc.
Unlike the previous buyback in which a large number of shareholders sold a portion of their shareholding, the current buyback involves the clean exit of a part of Flipkart’s large shareholder base.
Exiting shareholders include Shekhar Kirani, former LinkedIn exec Deep Nishar, IDG Ventures and a large number of pension funds, said Paper.vc. It said major investors Tiger Global, Accel, Naspers, software maker Microsoft and online retailer eBay remain on the ‘cap table of Flipkart.’
The company has raised $6.11 billion in equity funding till date, according to data analytics firm Tracxn.
