Walmart-backed Indian e-commerce start-up Flipkart last week announced a one-time discretionary cash payout of nearly $700 million.
The movement will likely benefit 25,000 ex and current employees of the company owning employee stock options, making it one of the largest wealth-creation options in the country.
“We are pleased to announce that employees, who are holders of Flipkart ESOPs (employee stock option plans), will receive a one-time discretionary cash payout as part of the transaction. This payout represents the value of the PhonePe holding within those Flipkart options," Kalyan Krishnamurthy, the CEO wrote in an eternal email, VCCircle reported.
Multiple media sources claimed that the top 20 employees and senior officials would receive more than $200 million out of the entire amount.
Recently, the company completed its separation from the Indian fintech firm PhonePe. Hence PhonePe’s employees will not be eligible for the payout. However, Flipkart’s employees who hold the fintech company’s share can participate in the programme.
Considering the rise in PhonePe’s valuation, the payout will be made at $43.67 per share.
“The new share price of Flipkart has been determined at $165.83 per option (previously $189.1), excluding the value of PhonePe. The payout to employees will, however, be at $43.67 per option, reflecting the increase in the market valuation of PhonePe," The email added.