Ahead of digital payments platform PhonePe’s initial public offering (IPO), e-commerce firm Flipkart and PhonePe on Friday announced the full ownership separation of the latter. The companies said that establishing these businesses as individual entities will allow both to chart their own growth paths, as they continue building industry-leading offerings that provide access and inclusion for Indians.
“Setting up these businesses as separate entities will also provide value and create new opportunities for investors to participate in the Indian tech ecosystem — helping unlock and maximise enterprise value for shareholders of the two companies,” according to a statement on Friday.
It added that Walmart will remain the majority shareholder of both 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,” it said.
According to media reports, PhonePe is gearing up for its IPO and preparations are underway.
The PhonePe Group was acquired by the Flipkart Group in 2016. Since its launch, PhonePe has successfully digitised more than 35 million offline merchants spread across Tier 2, 3 and 4 cities and beyond, covering 99 per cent of PIN codes in the country.
Sameer Nigam, founder and CEO of PhonePe, said, “Flipkart and PhonePe are proud, homegrown Indian brands with a user base upwards of 400 million each. We are looking forward to the next phase of our growth as we invest in new businesses — like insurance, wealth management and lending, while also enabling the next wave of growth for UPI payments in India. This will help propel our vision to provide billions of Indians with financial inclusion.”
From its beginnings in 2007 selling books online, the Flipkart Group has pioneered several industry-firsts through Flipkart.com along with several businesses such as Myntra, Cleartrip, Flipkart Health+ and more.
Kalyan Krishnamurthy, CEO of Flipkart Group, said, “The Flipkart Group has developed many successful entrepreneurs and seen impactful businesses started by former employees. We are proud to see Phone grow and thrive as a successful organisation in its own right.”
Krishnamurthy added that PhonePe will continue to scale and achieve its vision of providing financial inclusion to millions of Indians. Flipkart stays committed to its purpose to empower every Indian’s dream by delivering value through innovation in technology and commerce while helping small businesses connect to pan-India markets.
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