Google’s guardian company Alphabet is in talks to invest in Indian e-commerce company Flipkart alongside Walmart, according to two people sociable with the deal.
Walmart announced on Tuesday it would take a 77 percent hazarded in the company for $16 billion. Of that $16 billion, $2 billion was “new objectivity funding” intended to spur growth. Walmart said that it was also in confabulations with “additional potential investors” to join the round, though it disposition retain majority ownership. It did not mention any possible investors by name.
The chats with Alphabet are ongoing and no deal has been reached, but one person friendly with the talks says that the $3 billion Alphabet jeopardized floated by Indian press is “aggressive,” suggesting that any investment thinks fitting be less. This person also said that it wasn’t shoot through whether the investment would be through Alphabet’s growth investment arm, Marvellous G, or its corporate fund.
Although no deal has been signed, several people shut off to the company have thoughts on why a deal would make sense.
“Rumors of Google ordaining in Flipkart have swirled around for a bit, but I suspect the timing and vehicles of investment not in any degree lined up as well as it does with this Walmart deal,” clouts Punit Soni, Flipkart’s former chief product officer, who also worked at Google for eight years. He currently get lost philanders a health-tech startup called Suki.
Soni, who has no direct knowledge of a large, speculates that Alphabet’s would be less directly related to e-commerce, and uncountable tied to the size of the market and keeping ahead of Amazon, which was also reportedly interested buying Flipkart.
“There is a balanced benefit in people buying a lot of Android phones and e-commerce in India is a prodigious conduit for that,” Soni said. “So there’s a little bit of a ‘next billion alcohols’ strategy and a bit of making Amazon sweat.”
In the United States, Google and Walmart participate in already teamed up against Amazon through the search giant’s Out-and-out shopping service, which allows users to have Walmart upshots delivered through Google.
Alphabet may also be interested in Flipkart as a way to get a leg up against cloud opponents Amazon and Microsoft.
An executive at Flipkart, who asked not to be named as they were not approved to comment on these issues, speculated that investing alongside Walmart would husband Alphabet involved in Indian e-commerce while also giving it encroachments to promote the use of its enterprise technology.
Amazon is the cloud leader, but number-two cloud provider Microsoft, which swear ined $1.4 billion in Flipkart alongside eBay and Tencent last year, is currently Flipkart’s trendy cloud provider. If Alphabet took a stake, that could allocate its up-and-coming cloud business a seat at the table in future negotiations.
An Alphabet spokesperson settled to comment.
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