Amazon wants to pick up 60 per cent of Flipkart

Walmart will buy at least 55% of Flipkart in a deal that will value the company at $20-21 billion

As for why both US retail giants want a piece of Flipkart, India's e-commerce market is expected to be worth $200 billion annually in the next 10 years.

A recent ET report said Flipkart has set aside $400 million to buy back shares from small investors as it seeks to regain its private limited company status in Singapore. Some reports suggest that Walmart isn't out of the game and has made a counter-offer by holding out the option of floating an IPO for Flipkart that could give early investors in the company a very lucrative exit option.

Walmart was likely to reach a deal to buy a majority stake in Flipkart by June-end for $10-12 bn.

It has been reported that the key officials of Flipkart had raised their eyebrows over the sale of almost 80% of the firm's stake to both Walmart & Amazon combined, as the move can face resistance from anti-competition regulators in India.

SoftBank, Flipkart and Amazon did not comment on the development.

Amazon.com, Inc. (NASDAQ:AMZN) isn't going to simply sit on the sidelines and watch its chief rival make a big splash in the Indian e-commerce space.

SoftBank was reportedly more keen on Flipkart considering Amazon, which meant a share swap between its Indian unit and Flipkart, while other investors like Tiger Global Management, Accel, Naspers and Tencent are in favor of Walmart.

One of the sources said that Flipkart had vetoed an approach from Amazon for a 51 to 55 percent in the company two years ago, judging its offered price as far too low at the time. Reuters reported it would be Walmart's biggest acquisition of an online business. In contrast, a Form 1 notification, which is what competing companies file when their combined market share is below 15%, requires an approval process of three months.

Walmart also gets to grab a foothold in India's booming e-commerce industry. It is a second bid for Flipkart after Walmart had declared to acquire almost the same amount of stake for United States dollars 12 billion.

India's e-commerce industry is expected to reach US$200bn by 2026, up from $38.5bn previous year, according to the India Brand Equity Foundation, which was founded by the Indian government.

In an interview with Reuters on Tuesday, McKenna downplayed analyst criticism that the company has been slow to move in India.

Walmart's shares were 0.84 percent down at $86.67 during afternoon U.S. trading.

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