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Amazon makes one final effort to snap up Flipkart

Amazon makes one final effort to snap up Flipkart

The Amazon bid offers a breakup fee of $2 billion, while the Walmart offer includes the buyout of over 80% stake. For this, it is also willing to pump in an additional $3-4 billion, if Flipkart opts to pursue Amazon's offer instead of Walmart.

However, latest offer from Amazon might help Flipkart to negotiate a better deal with Walmart, said sources. This comes amid reports that Flipkart's largest shareholder SoftBank may be pushing for a merger with Seattle-based Amazon.

The report follows reports of USA retail giant Walmart's $12 billion deal to acquire a 55 per cent stake in the Bengalure-based retailer, which is likely to be signed as early as next week. Some reports suggest that Walmart isn't out of the game and has made a counter-offer by holding out the option of floating an IPO for Flipkart that could give early investors in the company a very lucrative exit option.

It is interesting to see how all this pans out and if Flipkart considers the offer from Amazon, or accepts Walmart's offer to take on Amazon head-on in what is now a fiercely fought battle in the Indian e-commerce arena.

Flipkart didn't respond to an email seeking comment. Amazon's bid is likely to be on par with Walmart's bid for the Indian e-commerce company, CNBC-TV18reported.

Further, they added that Walmart will get a majority of its stake by purchasing shares from existing Flipkart investors at a discount to the $20-21 billion tag.

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But Flipkart presents a massive business opportunity and that seems to be driving up valuations, aided by the fact that Walmart has also been stalking the company.

Last month Bloomberg reported the Bentonville, Arkansas-based retailer was likely to emerge as the victor of the bidding war with it offering around $20 billion. A source told TOI that "the shareholding agreement with Walmart is still to be signed".

FILE PHOTO: A Common myna sits next to the logo of India's e-commerce firm Flipkart installed on the company's office in Bengaluru, India April 12, 2018.

Amazon has made an official offer to acquire a 60% stake in Flipkart.

In an interview with Reuters on Tuesday, McKenna downplayed analyst criticism that the company has been slow to move in India.

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