eBay plans to relaunch its India business after selling its stake in e-commerce company Flipkart to Walmart in the $16 billion takeovers of the fast-growing Indian startup, as per media reports.
Last year, eBay invested around $500 million for a 5 percent stake in Flipkart.
It had also sold its eBay India business to the startup. The two sides had also entered into commercial agreements intended to boost cross-border trade for both companies.
However, with Walmart’s purchase of a 77 percent stake in Flipkart, eBay will no longer own a piece of the startup. It will also end its strategic partnership with Flipkart.
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This would mean eBay will terminate Flipkart’s license to use the eBay.in the brand name.
“We plan to relaunch eBay India with a differentiated offer to focus initially on the cross-border trade opportunity, which we believe is significant,”
the company said in a statement.
The company is of the point of view that there is huge growth potential for e-commerce in India and significant opportunity for multiple players to succeed in India’s diverse, domestic market.
Flipkart had said during its acquisition of eBay.in that the platform would be leveraged for cross-border trade, a move designed to give Flipkart’s vendors access to eBay’s global customers and Flipkart’s customers access to eBay’s global inventory of products. Following this, an email was sent to ‘select sellers’ providing an opportunity to sell on eBay.in platform, but nothing significant took off. And now seems like eBay India is going on the path of cross-border selling without Flipkart.
Flipkart will leverage Walmart’s omnichannel retail expertise, grocery and general merchandise supply-chain knowledge and financial strength, while its talent, technology, customer insights and innovative culture will benefit the US retail giant in India and elsewhere.
Post-acquisition, both the partners will leverage their strengths but will maintain their distinct brands and operating structures.
Meanwhile, Walmart’s foray into India’s online retail space made industry experts say the deal would make India an attractive destination for global majors to invest in the e-tail segment.
Terming the buyout a Rs 1 lakh crore all-cash deal, Paytm Founder Vijay Shekhar Sharma tweeted that it was a perfect answer to those who were dismissive of Indian start-ups in an open-for-all market.
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