Flipkart to buyback $700 million ESOP for PhonePe's fundraise

29 Nov 2022 , 12:33 PM

Domestic e-commerce company Flipkart is likely to facilitate a $700 million employee share buyback as part of a new funding round for digital payments platform PhonePe. According to reports from various media houses, PhonePe will have a different shareholding structure and Flipkart’s valuation will increase from $37.6 billion to $33 billion.

This is the company’s fourth ESOP buyback and reports say a formal announcement will be made next month. It bought back $80 million worth of stock from employees in 2021 after raising $3.6 billion. Earlier, Flipkart did a $500 million ESOP buyback in 2018 ahead of its eventual acquisition by Walmart. This will lead to the major ESOP buyback of Walmart-owned Flipkart in the Indian startup ecosystem.

The buyback should happen across the Flipkart group of companies, including Flipkart, PhonePe and Myntra. Employees will have the option to reinvest in shares through a new shareholding model or cash out in the secondary market.