The proposed transaction could reduce Flipkart’s holding in the logistics company from about 8% to nearly 2%, while leaving their commercial partnership intact.
Flipkart is preparing to sell a large part of its stake in Shadowfax Technologies in a transaction valued at roughly ₹700 crore to ₹750 crore, according to people familiar with the discussions.
The proposed sale is expected to take place through a block deal after the expiry of a six-month lock-in period linked to Shadowfax’s stock market listing. The transaction could be completed towards the end of July, although its timing and final size will depend on market conditions.
Neither Flipkart nor Shadowfax has formally announced the proposed deal.
If completed on the terms currently being considered, the sale would mark another significant reduction in Flipkart’s ownership of the logistics company. Flipkart is understood to hold around 8% in Shadowfax after diluting part of its stake during the company’s initial public offering.
The e-commerce company could sell approximately 33.7 million shares, bringing its holding down to about 2%. The remaining stake is expected to be retained to comply with minimum promoter contribution requirements.
The shares may be offered at a discount of around 2% to 4% to the prevailing market price.
Early Shadowfax investors may join the sale
Flipkart’s proposed divestment is likely to form part of a wider block transaction involving other early shareholders in Shadowfax.
Investors that could participate include Mirae Asset, Eight Roads Ventures, Qualcomm Ventures and TPG NewQuest. Their participation has not been formally confirmed, and the final composition of the deal may change before execution.
A transaction involving several existing investors could increase the volume of Shadowfax shares available in the market after the lock-in period ends. It may also provide early backers with an opportunity to realise part of the value created through their investment.
Flipkart continues to unlock value from investments
The possible Shadowfax sale fits into Flipkart’s broader effort to generate liquidity from investments made outside its core e-commerce operations.
Over the past year, Flipkart has reportedly raised more than ₹2,500 crore through stake sales and exits involving companies such as BlackBuck, businesses linked to the Aditya Birla Group and other portfolio investments.
These transactions have allowed the Walmart-owned company to release capital without immediately relying on a fresh external fundraise. They have also supported efforts to reduce cash burn and strengthen its financial position while plans for a Flipkart public listing remain deferred.
The Shadowfax investment has been part of Flipkart’s portfolio since 2019. Flipkart participated in multiple funding rounds as the logistics company expanded its network and services.
Business relationship expected to continue
A reduction in Flipkart’s shareholding is not expected to end the operating relationship between the two companies.
Shadowfax remains a logistics partner for Flipkart, supporting functions such as last-mile delivery, hyperlocal shipments, order fulfilment and additional capacity during high-demand periods.
This means the proposed sale is primarily a financial transaction rather than an indication that the companies are moving away from their commercial arrangement.
Flipkart would continue to hold a small stake after the deal, while Shadowfax would remain part of its logistics network.
What the deal could mean for both companies
For Flipkart, the proposed block deal would convert a portion of its investment into cash while preserving a limited ownership position in Shadowfax. It would also add to the funds already generated through portfolio monetisation.
For Shadowfax, the transaction could bring more of its shares into public circulation and expand its shareholder base. However, the block deal itself would involve the transfer of shares held by existing investors rather than the issue of new shares by the company.
The final value of the transaction will depend on the number of shares offered, the agreed discount and Shadowfax’s market price when the deal is executed.
Until an official announcement is made, the proposed ₹700 crore to ₹750 crore sale remains subject to change.
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