Walmart-backed Indian e-commerce firm Flipkart has held discussions about potentially acquiring on-demand delivery platform Dunzo, TechCrunch reported on Tuesday, citing three people familiar with the matter.

While talks are still ongoing, complexities surrounding Dunzo’s ownership structure have prevented the two sides from reaching an understanding on a deal, the report said.

The retail arm of Reliance Industries, which acquired 26 percent of Dunzo in 2022 for $200 million, has yet to approve the deal, the report added.

Dunzo, in an emailed response to Reuters, denied having “any conversation with any player to acquire the business”.

Flipkart and Walmart did not immediately respond to Reuters requests for comment.

Cash-strapped Dunzo, which is also backed by Alphabet’s Google, has announced restructuring, pay freezes and layoffs in the recent past.

Last year in April, Dunzo raised $75 million (roughly Rs 614 crore) in convertible notes and cut about 30 percent of its staff as it planned to revamp its business model.

Lead backers Reliance Retail and Alphabet had added around $50 million (roughly Rs 409 crore) of the funding, with other existing investors putting in the rest.

Under the new business model, the company is said to cut about 50 percent of its dark stores and operate only those that can be profitable or are approaching that threshold.

In July 2023, Walmart paid $1.4 billion (roughly Rs. 11,520 crore) to buy out hedge fund Tiger Global’s investment in Flipkart. The transaction valued the e-commerce firm at $35 billion (roughly Rs. 288,010 crore).

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