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Walmart to retain Flipkarts top executives if deal takes place

Thursday, April 19th, 2018

The top executives of Flipkart, including chief executive officer (CEO) Kalyan Krishnamurthy, will likely be allowed to retain their posts by Walmart if the proposed deal between the two firms take place.

Walmart is competing with rival Amazon.com Inc. to purchase a majority stake in Flipkart, which also owns the online fashion retailers Myntra and Jabong and the mobile payments app PhonePe. While it’s a two-way race, Walmart’s talks are at an advanced stage and the retailer is closer to buying around 55% stake in Flipkart.

Walmart is planning to retain key executives at Flipkart and senior leaders at Myntra-Jabong and PhonePe. Myntra CEO Ananth Narayanan and PhonePe co-founders Sameer Nigam and Rahul Chari are likely to continue in their roles if the Flipkart-Walmart deal goes through. Under the proposed plans, compensation for some of the key executives will be paid out over several years to ensure they stay with the company after the deal.

Further, Walmart has expressed interest in offering a significant role to Flipkart executive chairman Sachin Bansal and wants him to be more involved in the running of the company.

Bansal has been mostly out of day-to-day operations after he was promoted as CEO in January 2016. Since last year, Flipkart co-founders Sachin Bansal and Binny Bansal, who is Flipkart Group CEO, tried to increase their involvement in the running of the company. Also, Walmart is keen for Krishnamurthy to continue as Flipkart CEO. Krishnamurthy is a former executive of Tiger Global Management and is close to Lee Fixel, Managing Director of  Tiger Global.

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As Tiger Global is expected to sell its 20% stake as part of the proposed Flipkart-Walmart deal, some of the industry analysts thought that Krishnamurthy would leave the company. However, Walmart is adamant that Krishnamurthy continues as CEO.

Krishnamurthy was unexpectedly brought into Flipkart during June 2016 by Fixel to turn around market share losses to Amazon, which at that point seemed as though it would overwhelm its local rival at the top of the e-commerce market. The Fixel’s move worked almost instantly. Driven by the experienced and workaholic Krishnamurthy, Flipkart outsold Amazon in the key Big Billion Days sale in October 2016. It has since maintained its slender lead over Amazon.

Krishnamurthy, a former eBay manager, was rewarded for his efforts by Fixel and the other members of the Flipkart board by getting the CEO position in January 2017, in place of Binny. After taking charge of the office, Krishnamurthy removed nearly all of the senior-most leaders at Flipkart, preferring to work with a small group of mid-level executives. As a result of his successful turnaround efforts, Krishnamurthy had turned out to be indispensable at Flipkart. His decision to work without a senior management team has only made him more so.

Both, Walmart and Flipkart refused to comment.

 

(Source: www.livemint.com)

 

 


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