Two big acquisitions in two consecutive days; Global business giants now eyeing South Asian market

It was daraz first and then Flipkart, two popular online stores of their respective regions were acquired by world's renowned and giant buisness houses. The entire shares of pakistan based "Daraz" was bought by Alibaba, whereas 77% shares of India based Flipkart was bought by wallmart. This two big deals happened in two consecutive days. With this deals, south asian market is now to become a part of global online market eco-system. 

Alibaba acquires Daraz    

The biggest IPO issuer in New year stock exchange and the chinese tech giant company, on tuesday, acquired the entire share capital of Daraz, the Pakistan-based e-commerce company that was founded in 2012 and has been running online marketplace services in a number of South Asian countries including Nepal. The change in holding structure of the popular e-commerce platform is likely to bring a significant change in Nepal’s e-commerce landscape that has been struggling to catch a pace. The deal amount though is kept behind the veils, the deal has been unveiled by Germany-based Rocket Internet, the incubator of Daraz, by issuing a statement. 

The statement issued by Rocket Internet said that five South Asian markets to which Daraz is serving at present have a combined population of over 460 million, 60 percent of it under 35. Daraz currently operates online marketplaces in Bangladesh, Myanmar and Sri Lanka apart from Nepal. Inspite of the acquisition, the company is to operate with the existing name of Daraz.

Entering Nepal with the name "Kaymu.com" in 2012, the company later had its name changed to "Daraz.com" following Rocket Internet's decision to merge Daraz with Kaymu and operate with name of the latter. 

 

Walmart buys majority stakes of FlipKart    

On the very next day of Daraz acquisition, another big news hit the headlines when 77% stake of Indian online company "Flipkart" was bought by walmart. The deal, the largest ever in indian e-commerce industry, positioned Walmart as a major e-commerce player in the world’s second most populous nation. 

Walmart’s investment is sure to give Flipkart, which currently has 40% of India’s online market by sales, according to a renowned research firm, a lot more ammo to fight Amazon, which had pledged to spent huge invesment to win in the country.    

Flipkart, which was founded by former Amazon interns later became the first Indian startup to hit a billion-dollar valuation, and has employed more than 30,000 people. It has also been credited with pioneering payment methods like “cash on delivery” in a country where most people don’t own credit cards. 

 

These gigantic acquiring companies are transforming globally to meet and exceed the needs of customers and have now reached south asia. By acquiring the companies with huge customer base, these companies will soon have a strong presence in this region. Though, on one side, this has become a great news for consumers as they are now to be served with quality service of globally renowned companies, this could be threat for young start-ups trying to florish. This is, again, a high time for the domestic entreprenuers to build something great before its too late.