New Delhi, May 7: With just the formal signatures pending for a deal with Flipkart, Walmart has begun its search for real estate, mostly in Bengaluru, to have synergies with the e-commerce company headquartered there, sources said.
The American retail major is looking at shifting some critical divisions such as information technology (IT) and e-commerce to Bengaluru from Walmart India’s Gurugram office. The group may even explore relocating the entire Walmart India operation to Bengaluru in the near future. “If Walmart is spending more than $12 billion on acquiring Flipkart, it only makes sense for them to relocate to Bengaluru,” a source said.
Synergies are being planned on other fronts too. If things go according to plan, Walmart India and Flipkart could possibly have one common leader for both businesses, said a person in the know. It is not certain yet who that leader would be, but one of the Flipkart founders (Sachin Bansal and Binny Bansal, who are not related) could be a possible choice, according to a source. However, if Sachin Bansal sells his stake at a little over 5 per cent and steps down from Flipkart, as reports have suggested recently, either Binny Bansal or Kalyan Krishnamurthy, chief executive officer (CEO) of Flipkart, could be an option for the leadership position.
A similar leadership decision was taken when Walmart acquired American e-commerce major Jet.com in 2016. Marc Lore, founder of Jet.com, was appointed Walmart e-commerce CEO. Lore had accompanied Walmart chief executive Doug McMillon and president-CEO of Walmart International Judith McKenna to the Flipkart office in January.
Leading investment banking company Goldman Sachs is learnt to be advising Flipkart on a deal with Walmart, which wants to pick a controlling stake in the Bengaluru firm, valuing it at around $18-20 billion.
While the Walmart leadership had come down to Bengaluru earlier this year, most of the deal talks took place overseas, sources said. It is a very complex process to have one sale agreement with so many investors involved, a banker pointed out. Even Lloyd C Blankfein, chairman and CEO of New York-based Goldman Sachs, has been involved in the numerous rounds of talk.