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Flipkart acquires Walmart’s Indian wholesale business

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India’s Flipkart disclosed it had secured parent Walmart Inc’s local cash-and-carry business, as the e-commerce firm fortifies its wholesale offerings to contend better with Amazon.com Inc.

The deal allows Flipkart to launch a digital marketplace called Flipkart Wholesale next month, the Bengaluru-headquartered firm said, without disclosing any financial details of the deal.

The brand has 28 wholesale stores, two fulfillment centers, and more than 1.5 million members, largely comprising mom-and-pop stores, but Walmart has not been able to make money from this business.

The Flipkart deal comes as e-commerce players including Amazon look to woo India’s mom-and-pop stores that are considered the backbone of the economy.

Flipkart also faces competition from local online grocery upstart JioMart, backed by billionaire Mukesh Ambani-led Reliance Industries, whose digital arm has raised around $20 billion.

India does not allow foreign investors to control and market their own inventory on their e-commerce platforms, which is seen as giving JioMart and other local players an edge in a key growth market for e-commerce.

Walmart India employees will jump on the Flipkart Group as part of the deal, Flipkart said.

 

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