Walmart is seen selling bonds to help finance its purchase into the country’s biggest online seller, Flipkart. This acquisition is seen as stuffing the US investment grade market with another jumbo deal just two days after the second-largest of the year.
Walmart is offering many fixed- and floating-rate bonds in as many as nine parts, according to a filing on Wednesday. The longest portion of the offering is a 30-year security, which may yield around 1.2 percentage points above US Treasuries, according to a person with knowledge of the matter, who asked not to be identified because the details are private.
Walmart, the world’s largest retailer, said last month it will be acquiring a 77% stake in Flipkart for $16 billion, leaving the remainder of the stake with Flipkart co-founder Binny Bansal and other shareholders. The deal – Walmart’s largest ever – gives it a huge access to India’s fast-growing e-commerce market as the company constantly tries to challenge Amazon.com.
Walmart also acquired the e-tailer Jet.com for about $3.3 billion not too long ago in 2016. Just a week before Walmart announced its plans for a stake in Flipkart, it agreed to cede control of its British business, Asda, to a competitor for $10 billion. The sale reflects CEO Doug McMillon’s strategy to focus on high-potential markets, such as China and India. bloomberg
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