Mumbai | Bengaluru: SoftBank Vision Fund has held discussions with Flipkart to invest around $600-700 million, three years after the Japanese group exited the Indian online retailer by selling shares to Walmart Inc.
Sources close to the development told ET that the funding is part of a larger $2 billion round which could see the participation of a group of sovereign wealth funds like Abu Dhabi’s ADQ, Canada’s CPPIB, as well as the company’s existing investors such as GIC and Qatar Investment Authority.
The transaction is likely to value the Bengaluru-based firm at $25-30 billion, sources said.
"The talks have been ongoing with SoftBank and the final contours of the deal will be drawn up in the next few weeks," said a person close to the developments.
Significantly, if the SoftBank capital comes in, it could lead to Flipkart pushing back its plans for an initial public offering (IPO) in the US. "This would mean that Flipkart will stay on as a private company for longer than what was being earlier talked about."
The company has been preparing to go public by early next year, as reported earlier.
ET had reported on May 11 that the Canada Pension Plan Investment Board (CPPIB) is expected to join the fundraise along with existing backers such as GIC of Singapore and Qatar Investment Authority.
If the deal materialises, it will be yet another big move by the Masayoshi Son-founded SoftBank in India’s e-commerce market, which it has reordered with massive cash infusions. In 2017, SoftBank tried orchestrating a merger between its portfolio firm Snapdeal and rival Flipkart, but the deal was scuppered largely because of opposition from Snapdeal. The conglomerate went ahead to back Flipkart, only to sell its entire 21% holding to Walmart a year later for about $4 billion when the Bentonvile-headquartered retail behemoth bought a 77% stake in the Indian etailer.
SoftBank had earlier invested $2.5 billion in Flipkart before its 2018 exit. Its possible re-entry into the online retailer comes at a time when large Indian groups like Reliance Industries and Tata have sought to capture market share in the fast-growing consumer internet sector, and intend to deploy huge amounts of capital to prop up their digital businesses.
Flipkart’s traditional rival Amazon too has been relentlessly chasing the India market, having invested more than $7 billion in the country and diversified from etailing to online payments, streaming, food delivery, with more to come.
Queries sent to spokespersons at Flipkart and SoftBank did not elicit a response.