Flipkart earlier successfully completed the merger with eBay and was released on April 10, 2017. Because of this merger, Wal-Mart obtained control of Flipkart, but according to Recode, once Wal-Mart invested in Flipkart, Wal-Mart may Unable to complete the actual trading with Flipkart. Because of potential obstacles to this transaction, eBay and Flipkart have three years of exclusive commercial contracts and cover all types of goods except groceries.
Devin Wenig, president and CEO of eBay, commented on the transaction announcement: “The combination of eBay’s position as the world’s leading e-commerce company and Flipkart’s market position will allow us to accelerate and maximize the opportunities for both companies in India.”
At the same time, according to Reuters, Wal-Mart plans to invest approximately US$12 billion in the acquisition of 51% of Flipkart’s shares to counter Amazon’s competitors in the Indian market.
However, Flipkart’s latest regulatory report showed that the fiscal year ending March 2017 was a loss of 8.771 billion rupees ($1.4 billion), which forced Wal-Mart to consider whether it should conclude a deal with eBay.