Walmart-owned Flipkart is aiming to roll out its IPO (initial public offering) in the fourth quarter in the United States, Bloomberg reported, quoting unnamed sources. Walmart has also set up an internal team to look after Flipkart's IPO rollout, add the sources. However, the discussions relating to Flipkart’s IPO are “still in flux” and prone to change, the report said.
Earlier in March, it was reported that Flipkart is exploring the SPAC (Special Purpose Acquisition Company) route for a public listing. A SPAC, or a blank-check firm, is a company with a business plan centered around a merger or acquisition with another company. Companies generally prefer the SPAC route for IPOs as it involves less scrutiny. Before Flipkart, Grofers has also explored the SPAC option for public listing.
The development comes a few months after it was revealed that Flipkart's IPO would be worth $10 billion, the largest initial offering by a company based in India on overseas exchanges. Walmart also hired Goldman Sachs, a New York-based investment banking company, to assist with the listing in December 2020. Back then, Flipkart had said that rolling out an IPO has always been a part of the “company’s long term strategy”.
To recall, Walmart bought a 77 percent stake in Flipkart in a $16 billion deal in 2018. Later in 2020, Walmart raised its stake to nearly 82 percent after a $1.2 billion financing round. Meanwhile, in July 2020, Flipkart acquired Walmart India. Notably, Walmart operated 28 warehouse-club-style stores in India that serve independent retailers and other small businesses as regulations in India forbid Walmart to directly sell to consumers. After acquiring Walmart India, Flipkart launched a digital B2B shopping platform ‘Flipkart Wholesale’ in 2020.
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