Flipkart share buyback to turn hundreds of employees into crorepatis
Walmart Inc., which sealed the largest e-commerce deal in history with its $16 billion buyout of Flipkart on Wednesday, has set aside nearly $500 million to buy back shares from existing and former employees of Flipkart, according to three people aware of the development.
The ESOP (employee stock options) payouts may see a number of executives splurge on apartments and buy expensive goods such as luxury cars and high- to -mid-range sedan models, according to employees and real estate developers.
The ESOP buyback from Walmart will be the biggest ever in the Indian start-up ecosystem and is expected to turn a few hundred Flipkart employees into crorepatis. Existing employees may be given the option of cashing out fully across three years, the people cited above said.
The $500 million doesn’t include payouts to Flipkart co-founders Sachin Bansal and Binny Bansal and Flipkart CEO Kalyan Krishnamurthy.
Juggy Marwaha, executive managing director of JLL India, said the Flipkart employees are likely to invest some of their gains in real estate.
“I see them looking to buy apartments as well as strata or space buying in good-quality office buildings, which is where many HNIs are investing in today,” he said.