Flipkart Plans to Sell Shadowfax Stake Worth Up to ₹750 Crore: Report
Flipkart is set to sell up to a 6% stake in Shadowfax for ₹700–750 crore as part of its portfolio monetisation strategy.
SociapaHQ
Walmart-owned e-commerce firm Flipkart is looking to sell part of its stake in logistics company Shadowfax Technologies in a deal that could be worth ₹700-750 crore, a Moneycontrol report said, citing people aware of the matter.
The deal will likely be executed by end of July as part of a bigger block deal coinciding with the expiry of the six-month lock-in period after the public listing of Shadowfax. Shares will likely be offered at a discount of 2-4% to the current market price, the report said.
The proposed sale is the second such dilution of stake of Flipkart in Shadowfax and is part of the company’s overall portfolio monetisation strategy. The report added that Flipkart has raised over ₹2,500 crore through exits and stake sales in companies like BlackBuck and certain Aditya Birla Group companies.
Also Read: Mercedes-Benz Says BS VI Petrol Cars Are E20-Compatible After YouTuber Raises Mileage Concerns
Portfolio Monetisation:
The company has also been working on improving financial efficiency, reducing cash burn and delaying its own initial public offering (IPO), the report added.
Flipkart first invested in Shadowfax in 2019 and has taken part in multiple funding rounds since then. Over the years, Flipkart has relied on Shadowfax to support last-mile deliveries, hyperlocal deliveries and order fulfilment during peak demand periods.
Shadowfax’s updated draft red herring prospectus (DRHP) said Flipkart held nearly 14% stake in the logistics company before its IPO. Later, it sold a part of its stake through the offer-for-sale (OFS) route, bringing down its holding to about 8% and reportedly raising about ₹400 crore.
Also Read: FSSAI Urges Consumers to Report Unsafe Food Through Food Safety Connect App
The latest deal could further dilute Flipkart’s ownership. The company is expected to sell around 33.7 million shares or nearly 6% stake in Shadowfax, and will be left with an approximate 2% stake post the deal, the report added.
That said, Flipkart is not expected to exit completely at this stage. A portion of its remaining stake is subject to Securities and Exchange Board of India (SEBI) minimum promoter contribution requirements and still has a longer lock-in period and cannot be sold immediately.
