Google LLC is buying a $350 million stake in Flipkart Pvt Ltd., India’s largest e-commerce company.

Bloomberg reported that the search giant will provide the capital as part of a funding round worth nearly $1 billion. The investment is said to be led by Walmart Inc., Flipkart’s majority stakeholder. Last December, Walmart announced plans to invest $600 million in the e-commerce company.

Bengaluru-based Flipkart launched in 2007 as an online bookstore. Over the subsequent years, the company expanded into other product categories through a series of competitor acquisitions. Today, its e-commerce marketplace provides access to more than 150 million items and has a user base of more than 400 million consumers. 

One of the companies that Flipkart purchased as part of its acquisition spree was a mobile payments startup called PhonePe. When the deal closed in 2017, the e-commerce marketplace operator disclosed that it was worth $20 million. PhonePe became India’s most popular mobile payments platform following the acquisition and later spun off to become an independent company.

In 2018, Flipkart sold a 77% majority stake to Walmart for $16 billion. Last year, the brick-and-mortar giant grew its stake by buying $1.4 billion worth of shares from Tiger Global. At the time, the Wall Street Journal reported that the deal valued Flipkart at $35 billion, slightly below the $38 billion it was worth in 2021.

The new $1 billion funding round to which Google is contributing $350 million will reportedly boost the e-commerce company’s valuation to $37 billion. The size of the stake the search giant will receive in exchange was not disclosed. However, the companies did divulge that Flipkart plans to increase its use of Google’s cloud platform as part of the deal.

“Google’s proposed investment and its cloud collaboration will help Flipkart expand its business and advance the modernization of its digital infrastructure to serve customers across the country,” Flipkart said in a statement.

The deal comes about two years after Google announced a $1 billion investment in Bharti Airtel Ltd., one of India’s largest internet providers. At the time, the companies detailed that about a third of the capital was allocated to a series of go-to-market and product collaborations. Google earlier bought a 7.73% stake in mobile network operator Jio Platforms Ltd., Bharti Airtel’s largest competitor, for $4.5 billion.

Amazon.com Inc. is also making significant investments in India. Last year, the company announced plans to invest nearly $26 million in the country by 2030. That sum will come in addition to the more than $6.5 billion it has spent over the past decade to expand its local e-commerce marketplace, which competes with Flipkart.

Image: Flipkart