Binny Bansal has announced his resignation as CEO of Flipkart Group, effective immediately, following an independent investigation into an allegation of "serious personal misconduct," said Walmart Inc., in a statement.
The world's largest retailer said that Mr. Bansal had been an important part of Flipkart since co-founding the company, but that Mr.Bansal made the decision to step down after recent events risked becoming a distraction.
His decision follows an independent investigation done on behalf of Flipkart and Walmart into an allegation of serious personal misconduct. “He strongly denies the allegation. Nevertheless, we had a responsibility to ensure the investigation was deliberate and thorough,” said Walmart.
“While the investigation did not find evidence to corroborate the complainant’s assertions against Binny, it did reveal other lapses in judgement, particularly a lack of transparency, related to how Binny responded to the situation. Because of this, we have accepted his decision to resign.”
U.S retail giant Walmart’s $16 billion investment in Flipkart for about 77% stake in May this year not only provided blockbuster exits to the investors but also made the founders Binny Bansal and Sachin Bansal billionaires. The deal valued the homegrown e-commerce company at more than $20 billion.
Walmart said Mr. Bansal had been contemplating a transition for some time and “we have been working together on a succession plan,” which has now been accelerated. Going forward, Kalyan Krishnamurthy will continue to be CEO of Flipkart, which will now include Myntra and Jabong, continuing to operate as separate platforms within the Flipkart business.
Ananth Narayanan will continue as CEO of Flipkart’s fashion arms Myntra and Jabong and will report into Mr. Krishnamurthy. Sameer Nigam will continue leading Flipkart-owned digital payments firm PhonePe as CEO. Both Mr. Krishnamurthy and Mr. Nigam will report directly into the board.
“As we look ahead, we have full confidence in the strength and depth of leadership across the company. We remain committed to investing for the long-term and are supportive of the leadership team’s desire to evolve into a publicly-traded company in the future,” said Walmart.
Flipkart was founded by IIT-Delhi alumni and former Amazon employees Sachin Bansal and Binny Bansal [not related] in September 2007. Like Amazon, they started with selling books and initially had just three servers and 20 shipments.
In October this year, Mr. Bansal said that despite Walmart’s acquisition of Flipkart, he still considers himself as an entrepreneur. He said Walmart backs entrepreneurs in international markets as part of its strategy. “That was part of the deal… it really gelled well with us,” he had said.