Walmart-backed Indian e-commerce firm Flipkart has held discussions over potentially acquiring the on-demand delivery platform Dunzo, TechCrunch reported on Tuesday, citing three people familiar with the matter.
While talks are still ongoing, complexities surrounding Dunzo’s ownership structure have impeded the two parties from coming to an understanding over a deal, the report said.
The retail arm of Reliance Industries, which picked up a 26 percent stake in Dunzo in 2022 for $200 million, has not approved the deal yet, the report added.
Dunzo, in an emailed response to Reuters, denied having “any conversation with any player for an acquisition of the business”.
Flipkart and Walmart did not immediately respond to Reuters’ requests for comment.
Cash-strapped Dunzo, which is also backed by Alphabet’s Google, has announced restructuring, deferment of salaries and layoffs in the recent past.
Last year in April, Dunzo had secured funding of $75 million (roughly Rs. 614 crores) through convertible notes and had laid off about 30 percent of its staff as it planned a revamp of its business model.
Key backers Reliance Retail and Alphabet had added about $50 million (roughly Rs. 409 crores) of the funding, with other existing investors putting in the rest.
Under the new business model, the company was said to cut about 50 percent of its dark stores and run only those that could be profitable or were nearing that threshold.
In July 2023, Walmart paid $1.4 billion (roughly Rs. 11,520 crore) to buy out hedge fund Tiger Global’s investment in Flipkart. The transaction valued the e-commerce firm at $35 billion (roughly Rs. 2,88,010 crore).
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