Tiger Global, the giant crossover investor that has recently been on the hunt for liquidity, has sold its remaining stake in Indian ecommerce company Flipkart to Walmart for $1.4 billion, according to the firm’s letter to investors viewed by the Wall Street Journal.
Tiger Global first backed Flipkart in 2009 when it invested $8.9 billion during the company’s Series B at a valuation of $42 billion, and it has invested an additional $1.2 billion in the online retailer since then, Bloomberg reported.
Walmart’s secondary purchase priced Flipkart at $35 billion, down from a valuation of $37.6 billion the company had garnered in a late-stage primary deal in July 2021.
In 2018, Walmart bought a 77% stake in the company from Tiger Global and other investors for $16 billion. The firm realized a total gain of $3.5 billion on its Flipkart investment, according to the letter.
A representative of Tiger Global declined to comment.
New York-based Tiger Global opened up its entire portfolio of private assets to secondary investors several months ago but rejected hundreds of bids because the prices offered were below the firm’s expectations, Bloomberg reported.
After Tiger Global backed 315 companies in 2021, including many first-time investments, a large portion of those stakes have fallen in value as the pandemic-fueled tech investing boom waned. Discounts for deals closed in 2021 now range between 40% and 80%, according to secondary investors.
In comparison, Flipkart has lost less than 7% of its value in two years, making the Walmart trade an attractive deal for Tiger, especially since a part of the firm’s stake in the company was purchased in less-pricey earlier rounds.
Walmart likely is willing to take only a small discount on Flipkart because the US retailer is acquiring the stake for strategic rather than financial reasons, said Ken Sawyer, managing director at Saints Capital, a VC firm that invests in direct stakes and portfolios. “Tiger is getting liquidity where [it] can.”
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