Flipkart to raise $1 Bn for facing the competition against JioMart and Amazon
Flipkart is in talks with sovereign funds, private equity majors and other investors for a $1 Bn - $2 Bn funding round. The fundraise is expected to fuel Flipkart’s expansion plans and get an adjusted valuation based on the performance of its various verticals.
The company is planning an initial public offering (IPO) in the US this year through a special purpose acquisition company or SPAC, could raise up to $2 Bn depending on how well investors receive its pitch. Flipkart is expected to raise funds from the Canada Pension Plan Investment Board (CPPIB), Canada’s Caisse de dépôt et placement du Québec (CDPQ), Singapore’s GIC sovereign fund, private equity investor Carlyle among other sovereign funds, institutional investors and private equity funds.
According to sources, the fundraise is not seen as a pre-IPO round, but is primarily a capital raise for expansion and to unlock the value in each of its various verticals. “The price discovery process is still ongoing. Simultaneously, the US listing plans are ongoing with SPAC as a backup option,” one source was quoted as saying.
According to experts, it has a proven revenue model, the lion’s share in the Indian ecommerce market, would be a jackpot for US investors, especially with Walmart’s backing. To meet the 2021 IPO deadline set by its parent company Walmart, Flipkart has reportedly hired investment bank Goldman Sachs and is preparing to divest 25% of its stake at a valuation of $40 Bn. As per the latest report, the company could be valued at $30 Bn after its fundraise with the IPO driving up the valuation further.
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