Flipkart announced a spin-off of its company PhonePe, partially selling its stake in the company to Flipkart parent company Walmart. PhonePe raised $700mn in primary capital from the divestiture, enabling more autonomy over its operations. This divestiture has surged PhonePe’s post-money valuation to $5.5bn
Flipkart will remain PhonePe’s majority shareholder, and the two businesses will retain their close collaboration, according to the announcement. PhonePe claims to have more than 250mn registered users with over 100mn monthly active users generating nearly 1bn digital payment transactions in October 2020.
“As Flipkart commerce continues to grow strongly serving the needs of Indian customers, we are excited at the future prospects of the group. This move will help PhonePe maximize its potential as it moves to the next phase of its development, and it will also maximize value creation for Flipkart and our shareholders,” said Kalyan Krishnamurthy, CEO of Flipkart Group.