Walmart buys Flipkart ESOPs worth $800 m

Flipkart employees are in for a rich harvest from their stock options weeks after Walmart completed its $16-billion investment in the eCommerce company. Flipkart has announced in a letter to current employees that they will be allowed to liquidate their employee stock ownership plans (ESOPs) at $126-128 a unit, depending on the charges applicable.

Walmart is obligated to purchase 6,242,271 shares from Flipkart’s ESOP pool of 11,947,026 shares, according to a recent filing by the global retail giant with the US Securities and Exchange Commission.

In effect, Walmart will purchase from Flipkart employees ESOPs worth nearly $800 million. The worth of Flipkart’s total Esop is about $1.5 billion based on the per-share purchase price. “The ESOP repurchase programme, a yardstick for the industry, is part of our continuing efforts to thank and reward our employees for their service,” a spokesperson for Flipkart said in an emailed statement.


However, employees currently working with the online retailer will be allowed to liquidate 50% of their vested ESOPs following the close of the Walmart-Flipkart transaction, another 25% at the end of one year following the first liquidation, and the remaining 25% at the end of two years following the first liquidation.

In December, Flipkart bought back ESOPs worth over $100 million from more than 3,000 current and former employees of the online retailer, its fashion arms Myntra and Jabong, and its payments arm PhonePe.

The development was reported by ET Retail


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