SUB-GROUP: 11

WALMART’S
ACQUISITION OF
FLIPKART: A SHOWSTOPPER
DEAL?
Heet Shah – DM242024
Iishika Saxena – DM242025
Pratik Sureka – DM242054
Pravin Pagadala – DM242055
Sunil Behera – DM242084
Tallin Mehta – DM242085
 OVERVIEW

 In May 2018, Walmart Inc. (Walmart) announced its acquisition of a 77per cent stake in the
Indian e-commerce company Flipkart India Pvt. Ltd. (Flipkart).It was the largest acquisition
of an Indian company and the world’s largest purchase of an e-commerce company. The
deal would provide Walmart with the opportunity to expand globally in competition with its
old rival, Amazon.com Inc., and it would provide Flipkart with additional capital to operate in
a hyper competitive environment and an opportunity to leverage Walmart's omni-channel
retail expertise.
 WHAT FACTORS MOTIVATE INTERNATIONAL
MERGERS AND ACQUISITION?

 Technology and Talent Acquisition

 Customer Base Expansion to Existing Markets

 Competitive Advantage

 Diversified Products and Services

 EXAMINE THE BUSINESS STRATEGY BEHIND
THE WALMART-FLIPKART DEAL.
Flipkart and Walmart would continue to maintain distinct brands and operating structures after
the deal and the acquisition was meant to be a win-win for both entities:

WALMART
 Aim to globalize the business and build a technological arsenal
 Attempt to enter the Indian retail market with Flipkart's solid customer base
 Leverage Flipkart's technical expertise to build Walmart's global e-commerce business
 Competition for Amazon, to whom it had been losing ground in its home country

FLIPKART
 Funds and access to traditional investors and venture capitalists
 Access to additional capital to operate in a hypercompetitive environment
 Leverage Walmart's omni-channel retail expertise and grocery and supply chain knowledge
 WHAT ARE THE KEY HUMAN RESOURCES ISSUES
THAT MAY IMPEDE THE SMOOTH IMPLEMENTATION
OF THE WALMART -FLIPKART DEAL?
Cultural Conflict
 Flipkart's entrepreneurial culture, based on innovation, flexibility, and agility VS. Walmart’s
traditional culture with set practices, hierarchical processes, stability, and thoughtful
planning
Leadership Issue
 Pre-acquisition - accessible leader with whom technology-related issues could have been
discussed VS. Post acquisition - autonomous leadership
HR Management
 Walmart: hire-and -fire culture - led to rumors of job cuts at Flipkart and worry among
employees.
 Changes in ESOPs plan - Caused disappointment among existing employees
 WHAT IS THE ROLE OF HUMAN RESOURCES MANAGER IN
INTERNATIONAL MERGERS AND ACQUISITIONS?

Managing culture at each stage of the acquisition in order to achieve the foreseen
strategic and financial goals, while also keeping cultural clashes in mind.

Pre-acquisition stage
 Assist executives and leaders on both sides in defining the cultural endpoint for
the combination.
Acquisition stage
 Deepen cross-cultural learning among both partners and steer the new
partnership toward the desired cultural end-state
Post Acquisition stage
 Ensure that the emerging culture was preserved and reinforced
HOW CAN THE HUMAN RESOURCES DEPARTMENT OR
TEAM CONTROL THE CULTURE RELATED ISSUES TO
GUARANTEE HUMAN RESOURCES ALIGNMENT WITH
BUSINESS STRATEGY?
Pre-acquisition stage
 Decide whether the culture followed would be of the parent company, partner company. a mix of
both the companies or entirely new culture based on the transformation process.
 Convey the vision and mission of the deal employees to motivate them and foster cross culture
learning across both the companies
Acquisition stage
 Leaders in both the companies could acknowledge their differences and similarities to reach a
 common platform and embark on a journey towards creating a unified culture

Post Acquisition stage

 Identify a set of change agents which could help drive the translation through three stages
WHAT, IN YOUR VIEW, WOULD BE THE FATE OF
THE WALMART-FLIPKART DEAL?

 Business synergies are evident - Walmart's entry into the Indian market and
Flipkart's access to Walmart's resources and capabilities can help them stay ahead
of Amazon.
 A new environment for employees and managers to improve their own skills while
gaining a new worldly perspective - aiding in overall learning.
 The deal strengthens both companies' business in a highly competitive market.