• News
  • Gadgets News
  • PhonePe is no longer Flipkart company: Why the separation and what it means
This story is from December 24, 2022

PhonePe is no longer Flipkart company: Why the separation and what it means

Earlier this year, PhonePe changed its domicile from Singapore to India. In October this year, PhonePe said it had finished moving all the businesses and subsidiaries of PhonePe Singapore to PhonePe Pvt Ltd – India, including its insurance broking services and wealth broking businesses. The separation will reduce Flipkart’s valuation slightly from $37.6 billion to around $33 billion.
PhonePe is no longer Flipkart company: Why the separation and what it means
The separation will reduce Flipkart’s valuation slightly from $37.6 billion to around $33 billion. Representative Image
Flipkart and PhonePe are ‘parting ways’. Flipkart has completely separated its business operations from Phone’s, the two entities announced, saying that the move would allow both to chart their own growth paths. PhonePe Group was acquired by Flipkart Group in 2016. "We are confident PhonePe will continue to scale and achieve its vision of providing financial inclusion to millions of Indians," said Kalyan Krishnamurthy, CEO of Flipkart Group.

Walmart continues to be the parent of both the companies
Both Flipkart and PhonePe will continue to operate under US-based retail giant Walmart. Walmart will remain the majority shareholder in both the business groups. "As part of this transaction, existing Flipkart Singapore and PhonePe Singapore shareholders, led by Walmart, have purchased shares directly in PhonePe India. This completes the move to make PhonePe a fully India domiciled company, a process that started earlier this year," the companies said in a joint statement. The US retailer acquired a 77% stake in Flipkart for $16 billion in 2018; PhonePe was part of the Flipkart group at the time.
PhonePe comes to India
Earlier this year, PhonePe changed its domicile from Singapore to India. In October this year, PhonePe said it had finished moving all the businesses and subsidiaries of PhonePe Singapore to PhonePe Pvt Ltd – India, including its insurance broking services and wealth broking businesses.

Flipkart's valuation dips slightly
The separation will reduce Flipkart’s valuation slightly from $37.6 billion to around $33 billion.

The separation goes back to 2019
The Flipkart-PhonePe separation process started back in the year 2019. It was aimed at paving the way for PhonePe to raise funds independently and bring external investors on board. In December 2020, the online payments company raised primary capital of $700 million in a round led by Walmart that valued it at $5.5 billion.
PhonePe looking for new funding
The news comes at a time when PhonePe is looking to close a funding round of $1.5-2 billion and continues to hold talks with the likes of private equity firm General Atlantic and existing investor Tiger Global Management.

Big cash payout for Flipkart employees
As the Flipkart-PhonePe separation was formally announced, Kalyan Krishnamurthy, CEO of the Flipkart group, told employees in an email they would get "a one-time discretionary cash payout as part of the transaction”. “This payout represents the value of the PhonePe holding within those Flipkart options. It will present an event for wealth creation for our employees, which has been a continued commitment for Flipkart… Eligible employees will receive additional information and details on this payout shortly,” the email read.
Also Watch:

Mobile-only OTT plans from Amazon, Netflix and others | OTT Mobile Plans


End of Article
FOLLOW US ON SOCIAL MEDIA