Abu Dhabi’s ADQ in talks to invest $500m in Flipkart

Abu Dhabi sovereign fund ADQ is in talks to invest about $500m in India’s Flipkart, according to people familiar with the matter, as the Walmart-backed e-commerce firm raises funds ahead of a potential initial public offering next year.

The oil-rich emirate’s newest state investment company is discussing an injection of funds that would value Flipkart between $35bn and $40bn, the people said, asking not to be identified as the information is private. The fundraising would come ahead of a planned IPO that could take place as soon as 2022, they said.

Flipkart is seeking to raise at least $3bn and could decide to increase the amount to as much as $3.75bn, as investors have shown significant interest, the people said.

Considerations are ongoing and the talks could fall apart, the people said. Representatives for Flipkart didn’t immediately respond to a request for comment made outside business hours in India.

An ADQ representative was not immediately available to comment.

Flipkart is seeking to raise at least $3bn from a group of investors including SoftBank Group Corp., Singapore’s GIC Pte and Canada Pension Plan Investment Board, Bloomberg News reported June 7 citing people familiar with the matter. The group also includes the Abu Dhabi Investment Authority, one of the emirate’s largest sovereign wealth funds, the people said at the time.

ADQ, formerly known as Abu Dhabi Development Holding Co., has been one of the most active investors in the Middle East since its inception in 2018. It oversees about $110bn in assets, according to a report from Global SWF. That would make it the third largest of Abu Dhabi’s state investors, after ADIA with roughly $700bn and Mubadala Investment Co. with about $230bn.

The upstart firm has become a prolific dealmaker. In November 2020, ADQ agreed to buy a 45 per cent stake in agricultural trader Louis Dreyfus Company BV, with a minimum of $800m in proceeds from the sale to be invested in the firm. Bausch Health Cos. agreed to sell Egyptian drugmaker Amoun Pharmaceutical Co. to ADQ in March for $740m, the Canadian firm said.