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Flipkart hives off Phone Pe as separate entity
December 04, 2020
E-commerce giant Flipkart has announced a partial spin-off of its virtual payments platform PhonePe. In March 2019, PhonePe’s board had acquired in-principle approval from Flipkart to hive off as a separate entity.
The Walmart-controlled firm has made this flow to represent a new board of directors and access doors capital to fund PhonePe’s lengthy-term pursuits over the next three to 4 years. The hive-off might also enable PhonePe to carve out an ESOP program for its employees.
PhonePe is also elevating $700 million in number one capital at a put up-cash valuation of $5.5 billion from existing Flipkart buyers led with the aid of Walmart. Flipkart will remain PhonePe’s majority shareholder, and the two companies will hold their near collaboration, in step with a joint press release with the aid of Flipkart and PhonePe.
Speaking at the improvement, Sameer Nigam, Founder and CEO at PhonePe, said, “Flipkart and PhonePe are already a number of the extra distinguished Indian digital systems with over 250M users every. This partial spin-off gives PhonePe get admission to committed lengthy-time period capital to pursue our vision of presenting economic inclusion to billion Indians.‘