Amazon is presently considering an attempt to outbid Walmart for India's e-commerce platform Flipkart, according to recent reports from the South Asian country. Walmart and Flipkart have been negotiating a potential investment or a direct tie-up since at least February, industry sources said earlier this year, with the two still being more likely to come to an agreement than Amazon is to disrupt their talks, as per the latest reports. The Seattle, Washington-based company is said to have already held preliminary discussions with Flipkart, with some insiders being highly skeptical about the feasibility of such a consolidation. Amazon and Flipkart are by far the two largest e-commerce service providers in the country and any merger attempt would hence be likely to raise major competition concerns, thus prompting antitrust watchdogs in India to block it.
It's presently unclear whether a Flipkart bid was something Amazon seriously considered in the past or if its newly reported interest in the Bengaluru-based firm is simply a response to Walmart's advances. The Bentonville, Arkansas-incorporated retail giant is reportedly seeking to acquire more than 40-percent of Flipkart, according to February reports. Any e-commerce tie-up involving Flipkart would create the largest online shopping company in India, most industry watchers agree. Regardless of Flipkart's preferences, Walmart's chances of acquiring a controlling stake in the company are significantly higher than those of Amazon by virtue of the fact the former has a significantly smaller presence in India and hence isn't likely to be subjected to major regulatory scrutiny, at least not from the perspective of antitrust law. New Delhi is still relatively strict in regards to allowing such foreign takeovers and may require Walmart to agree to significant concessions before approving any move to take control of Flipkart.
Amazon has been much more aggressive with its expansion plans in India and has already committed billions of dollars to the country, having most recently entered the local grocery delivery market. Any major investment in Flipkart would likely require its suitor to pay a premium on the startup which was valued at approximately $12 billion in 2017 after SoftBank's Vision Fund purchased a $2.5 billion stake in the firm. India is expected to develop into one of the world's most valuable e-commerce markets in the coming years and is also considered to be the largest potential growth generator for most smartphone manufacturers which are presently combating market saturation in many other parts of the world.