Even as Walmart is reportedly in talks to acquire 40 per cent stake in Bengaluru-based e-commerce firm Flipkart, its global competitor Amazon Inc is also learnt to be in the fray for acquiring the said stake. Even last year, Walmart had shown interest in acquiring stake in Flipkart, but the talks could not materialise as the latter received funding from Microsoft, eBay and Tencent.

A source close to the development said that Walmart is in advance stages of negotiation on the deal value. Another industry insider said that Walmart’s purchase of Flipkart’s shares will be in the form of fresh issue as well as purchases from existing investors.

While Flipkart did not respond to questions mailed by The Indian Express, Amazon India spokesperson said, “We do not offer comments on rumours and speculations.”

With Snapdeal another Indian e-commerce player ceding ground, Amazon and Flipkart are said to be neck-to-neck in the domestic online retail sector. Reuters reported on Wednesday that the probability of a deal with Amazon was low, and that any such deal could spark monopoly concerns as Flipkart and Amazon dominate India’s e-commerce market. The person declined to be identified as discussions were private.

A deal would give the world’s largest brick-and-mortar retailer access to an e-commerce market that Morgan Stanley estimated to be worth $200 billion in a decade’s time. The deal would also represent a direct challenge to Amazon in Asia’s third-largest economy. Amazon has committed to investing $5 billion in India as it expands into online grocery delivery.

Currently, Flipkart is a part of portfolio of investors such as US-based Tiger Global and Japanese major SoftBank. Flipkart was valued at around $12 billion when SoftBank’s Vision Fund bought roughly a fifth of the firm last year for $2.5 billion.