In 1950, Sam Walton, who owned a small store called Dime & Nickle Store in Bentonville, a small town in Arkansas, opened his first major store, Walmart, in downtown Arkansas in 1962. (Today this store, next to the new location of the firm, remains as a museum.)
U.S. supermarket chain Walmart is buying 77 percent of India’s largest online retailer, Flipkart Group, for $ 16 billion. Flipkart co-founder Binny Bansal and his shareholders will split the remaining share.
Online retail giant Amazon.com by strengthening its hand against Walmart, the Flipkart deal made the largest acquisition in its history. According to Morgan Stanley estimates, Walmart’s dominance in this area could reach $ 200 billion over the next 10 years as it enters India’s e-commerce market.
Japanese banking giant Softbank had also invested $ 2.5 billion in Flipkart. After the deal, the share value will be $ 4 billion.
In India, the world’s second most populous country, online sales are growing by about 35 percent a year. The most important drivers of this growth are the middle class and urbanization. Even Amazon, the number one name in online retail, has spent billions of dollars to win customers in India.
Having a stake in Flipkart will give Walmart a chance to enter the Indian market without opening stores. Walmart, which has also tried to open stores at different points before, was caught up in the long-running bureaucracies of Indian management.
The US retail giant’s first entry into India was with research and investment company Bharti Enterprises, which it formed a joint venture in 2009 and acquired in 2013. Today, Bharti runs 20 retailers serving India’s small businesses.