Globally, in the last decade there has been a flurry of activity in the area of merger & acquisitions. As multinational companies are expanding due to more demand in the market, experts are of the opinion that it will on a rise in the next decade as well. Post the introduction of economic reforms in 1991, Indian industries faced several challenges, both nationally and internationally. The cut-throat competition from international markets forced the Indian companies to opt for merger and acquisition strategies, making it vital for survival.
In China, where the retailer has over 440 stores, it bought a 5% stake in JD.com, the second-largest online retailer in the country, in 2016, India had made it to the list. “Walmart needed Flipkart possibly more than Flipkart needed Walmart,” said Yugal Joshi, practice director at management consulting and research firm Everest Group. “It didn’t have any shortage of funds and Softbank and others were really invested. It is a strong sign that a global giant found an Indian startup so important for its own online survival in the online market.” For people who had been closely monitoring Walmart and its activities, it was not at all a surprise that Walmart would take this huge leap from brick and mortar stores to coming into the business of e-commerce. Walmart’s investment includes $2 billion of new equity funding to help accelerate the growth of the Flipkart business. Both companies will retain their unique brands and operating structures in India.
Read more in Aishwarya Sandeep’s blog