E-commerce giant Flipkart on Thursday said it has acquired 100 per cent stake in Walmart India, which operates the Best Price cash-and-carry business, and launched a new digital marketplace designed to help transform the kirana retail ecosystem in the country.

The announcement comes a week after Flipkart had said it had raised $1.2 billion in funding from a Walmart-led investor group. In 2018, Walmart Inc had invested $16 billion for acquiring 77 per cent stake in the group.

Walmart India runs 28 Best Price wholesale stores in the country. Best Price currently supports more than 1.5 million members, including kiranas and other MSMEs.

The latest move will allow the e-commerce giant to leverage the strong wholesale capabilities of the company.

It will also intensify competition with Flipkart’s rival Amazon that has a similar offering for the B2B segment.

Highlighting the importance of Kiranas and MSMEs the company said that two are central to India’s retail ecosystem and Flipkart Wholesale will focus on meeting their needs by providing small businesses a wide selection at significant value.

“Whether in grocery, general merchandise or fashion, these businesses will have one-stop access to an extensive selection of products with attractive schemes and incentives, supplemented with data-driven recommendations for stock selection, delivered through a fast and reliable network to drive greater efficiencies and better margins,” it said.

Flipkart Wholesale will launch its operations in August 2020 and will pilot services for the grocery and fashion categories.

It will be headed by Adarsh Menon, a veteran at Flipkart.

Kalyan Krishnamurthy, Chief Executive Officer, Flipkart Group, said, “The acquisition of Walmart India adds a strong talent pool with deep expertise in the wholesale business that will strengthen our position to address the needs of kiranas and MSMEs uniquely.”

Top Indian brands, local manufacturers and sellers have partnered with Flipkart Wholesale to ensure the availability of an exhaustive range of products and merchandise for kiranas and MSMEs, the statement said.

Meanwhile, Sameer Aggarwal, Chief Executive Officer at Walmart India, will remain with the company to ensure a smooth transition, after which time he will move to another role within Walmart.

With the acquisition of the Walmart India business, its employees will join the Flipkart Group and the home office teams will integrate over the next year.