Flipkart has issued an internal note with its employees sharing about a one-time voluntary cash payout as part of its separation deal with PhonePe
Flipkart’s CEO Kalyan Krishnamurthy shared a note that reads, “This payout represents the value of the PhonePe holding within those Flipkart options.”
The development has come shortly after Flipkart announced that it has completed the separation process of online payment platform PhonePe
Inc42 Daily Brief
Stay Ahead With Daily News & Analysis on India’s Tech & Startup Economy
After completing its separation process from PhonePe, ecommerce giant Flipkart has announced a cash payout for the employees parting from PhonePe. Flipkart spokesperson confirmed the development to Inc42, however, the payout amount couldn’t be established.
Just after the PhonePe separation process got through in the first part of the day, Flipkart, reportedly, sent an internal note to its employees with information of a one-time voluntary cash payout.
According to the Economic Times report, Flipkart’s CEO Kalyan Krishnamurthy shared a note with employees stating, “This payout represents the value of the PhonePe holding within those Flipkart options…. This payout will present an event for wealth creation for our employees, which has been a continued commitment for Flipkart, and one that we will remain focused on.”
In the mail, Krishnamurthy informed that eligible employees of Flipkart and PhonePe will receive information and details about the ESOP shortly. Post the separation, Flipkart’s stock options are priced at $165.83 apiece and therefore, eligible employees will be receiving a payout of $43.67 per share.
The development has come shortly after Flipkart announced that it has completed the separation process of online payment platform PhonePe.
As part of the deal, shareholders of Flipkart Singapore and PhonePe Singapore have directly bought shares in PhonePe India, in turn, making PhonePe a wholly India-domiciled company.
Post this deal, Walmart will become a major stakeholder in the above two companies.
In November, media reports were doing rounds that Flipkart was looking to introduce an ESOP buyback of about $700 Mn. The ESOP buyback would be part of PhonePe’s $2 Bn funding round, which would be led by Walmart along with General Atlantic.
The ecommerce giant is lately working on its post-sales services and simultaneously, looking to expand its online pharmacy business across India.
In the financial year 2020-21, its ecommerce marketplace, Flipkart Internet reported a net loss of INR 4,361 Cr as compared to INR 2,881.3 Cr losses incurred in FY21.
Meanwhile, its total income soared by 31% to INR 10,659 Cr in FY22 against INR 8,115 Cr income generated in FY21.
On the other hand, Flipkart’s B2B arm posted a loss of INR 3,404.4 Cr in the financial year 2021-22 (FY22) against INR 2,444.8 Cr in the previous fiscal year. While, its operating revenue rose by 18.7% to INR 50,992.5 Cr in the corresponding period from INR 42,941.7 in FY21.
Note: We at Inc42 take our ethics very seriously. More information about it can be found here.