SoftBank Group Corp. agreed to sell its entire 21% stake in Flipkart Online Services Pvt. Ltd. to Walmart Inc., which plans to buy 77% of the e-commerce company for $16 billion, The Economic Times (India) reported May 22, citing a source familiar with the matter.
The telecommunications company is expected to make approximately $4 billion from the transaction, the report said.
SoftBank, which had an investment in Flipkart through Vision Fund, was hesitant about the sale due to tax issues with its fund being registered in New Jersey, which has no tax treaty with India, the report added.
A SoftBank spokeswoman reportedly declined to comment.
The report added that the Japanese company's exit from Flipkart may enable it to increase its $400 million investment in Paytm Mall. SoftBank's agreement with Flipkart had a clause that does not allow it to invest more than $500 million in the mobile wallet company until 2020.
