India’s Flipkart, owned by Walmart, is moving toward a distressed sale acquisition of the Mumbai travel aggregation site Cleartrip, Times of India reported Wednesday, April 14.
The deal is expected to be announced in the coming days as Bengaluru-headquartered Flipkart continues going toe-to-toe with Amazon. The Indian eCommerce site is planning to tap Cleartrip to diversify and expand into more product and service verticals.
The tie-up will offer people digital bookings for rooms and flights and is anticipated to boost Flipkart’s overall gross merchandise value (GMV). The acquisition will also support Flipkart’s entry into the digital travel space, which is already crowded by frontrunners like Nasdaq-listed MakeMyTrip — which acquired Goibibo — as well as by Yatra and Booking.com.
Stuart Crighton, Hrush Bhatt and Matthew Spacie founded Cleartrip about 15 years ago. The economic travel fallout caused by the COVID-19 pandemic has sent the Indian startup in a downward spiral struggling to hang on.
The Mumbai startup earns upwards of 80 percent of its revenue from airline bookings and saw its revenue decline 2.5 percent last year. Apart from seeking a stake in Cleartrip, Flipkart recently acquired an 8 percent interest in Aditya Birla Fashion and Retail.
Earlier this month, Flipkart was looking toward an initial public offering (IPO) at a valuation of $35 billion. The company had previously considered going public via a special purpose acquisition company (SPAC), but that option has since been dropped.
Some 10 companies in India are readying for IPOs, including the InsurTech aggregator Policybazaar, and food delivery firm Zomato.
Flipkart said in a press release last month that is planning to team up with over 5,000 retailers across India.
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