Walmart may retain Flipkart top executives if deal goes through
In the event of a Flipkart-Walmart deal, the US retailer will retain Kalyan Krishnamurthy as CEO and may give founder Sachin Bansal a bigger role in the e-commerce firm
Bengaluru/New Delhi: Walmart is likely to retain the management team of Flipkart Ltd, including chief executive officer (CEO) Kalyan Krishnamurthy if the proposed deal of the e-commerce firm goes through, two people familiar with the matter said.
Walmart is competing with rival Amazon.com Inc. to buy a majority stake in Flipkart, which also owns the online fashion retailers Myntra and Jabong and the mobile payments app PhonePe. While it’s a two-way race, Walmart’s talks with Flipkart have advanced much further and the retailer is in pole position to buy more than 55% of Flipkart, the two people cited above said on condition of anonymity.
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The American retailer is devising retention plans for key executives at Flipkart as well as senior leaders at Myntra-Jabong and PhonePe, the people said. Myntra CEO Ananth Narayanan and PhonePe co-founders Sameer Nigam and Rahul Chari are likely to continue in their roles if the Flipkart-Walmart deal goes through, the people said. Under the proposed plans, compensation for some key executives will be paid out over several years to ensure they stay with the company after the deal, the people said.
Walmart has expressed interest in giving a bigger role to Flipkart executive chairman Sachin Bansal and wants him to be more involved in the running of the company, the people said. Bansal has been mostly out of day-to-day operations after he was pushed out as CEO in January 2016. Last year, Flipkart co-founders Sachin Bansal and Binny Bansal, who is Flipkart Group CEO, tried to increase their involvement in the running of the company.
Walmart is also keen for Krishnamurthy to continue as Flipkart CEO, the people said. Krishnamurthy is a former executive at Tiger Global Management and is close to Tiger Global managing director Lee Fixel.
As Tiger Global is expected to sell much of its 20% stake as part of the proposed Flipkart-Walmart deal, some analysts had expected Krishnamurthy to leave the company. But Walmart is insistent that Krishnamurthy continue as CEO, the two people said.
Krishnamurthy was parachuted into Flipkart for a second spell in June 2016 by Fixel to help reverse market share losses to Amazon, which then looked like it was going to overtake its local rival at the top of the e-commerce market. Fixel’s move worked almost instantly. Driven by the hands-on, workaholic Krishnamurthy, Flipkart outsold Amazon in the key Big Billion Days sale in October 2016. It has since maintained its slender lead over Amazon.
Krishnamurthy, a former eBay manager, was rewarded for his efforts by Fixel and the other members of the Flipkart board by getting the CEO job in January 2017, in place of Binny. After taking over, Krishnamurthy removed nearly all of the senior-most leaders at Flipkart, preferring to work with a small group of mid-level executives. Given his successful turnaround efforts, Krishnamurthy had become indispensable at Flipkart. His decision to work without a senior management team has only made him more so.
Walmart declined to comment. Flipkart didn’t respond to an email seeking comment.
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