Chief Executive of Flipkart Group, Walmart's Indian eCommerce business, resigned following internal charges to allegations of serious personal misconduct, "said Walmart on Tuesday.
The misconduct charges followed an allegation of sexual assault, two people who were familiar with the matter said.
The departure of Binny Bansal, 37, a Flipkart co-founder in Bangalore, could withstand Walmart's efforts to compete with Amazon in the massive India consumer market. Bansal joined the Flipkart Chief Executive in 2016. He has been the chairman and CEO group of the e-commerce company this year.
Walmart paid $ 16 billion for a small fraction of 77 percent in Flipkart in May. The investment is the largest acquisition of a US retailer and it was a major move in its efforts to compete against Amazon's growing market share at home and abroad.
Walmart announced that he would acquire the part in Flipkart in May and completed the contract in August. In a note sent to Flipkart employees, seen by Reuters, Chancellor said recent events had led him to step down from his role as chairman and CEO. He said that the incidents were about a claim against misconduct, "which was chastised after a thorough investigation had to be completed by an independent legal company."
Chancellor did not give details of the nature of the claim. "He left the allegations to me stunned and I strongly rejected them," he said.
"However, the investigation into lighting in my opinion, especially lack of transparency, was about how I responded to the situation," he said, without further elaboration.
Chancellor or representatives did not respond to requests for comments. Flipkart did not respond to requests for comments.
Someone in the United States who is familiar with the Walmart inquiry "commented on a sexual assault against Binny" at the end of July. The accusation has dated to a few years earlier and was made by a former Flipkart company, who did not have Flipkart at the time, added the person.
Walmart in filing said he was conducting his own investigation into the allegations, not saying what the allegations were.
"Although the investigation did not find evidence to confirm the complainant's claims against Binny, he revealed other defects in a ruling, particularly lack of transparency, about how Binny responded to the situation." Walmart said. "Because of this, we have received his decision to resign." The person who was familiar with the matter in Walmart said that Chancellor had employed two private security companies at the end of 2016, "to make this matter go away," referring to the alleged assault application. The person did not reveal the names of the security company or the interested parties and Reuters could not confirm them.
"Binny had the opportunity to reveal these claims to us when we were in discussions (to invest in Flipkart) … but it was not," said the person.
Going from the northern Indian city of Chandigarh, Bansal is one of India's most well-known entrepreneurs after the start of Flipkart in 2007 with Sachin Bansal. The duo, which comes from the same but unconnected city, formed a Flipkart shortly after giving Amazon the best.
Originally, an online bookshop ran out of a two-bedroom apartment in the center of Indian technology from Bengaluru. Flipkart grew up over the next decade to become India's most valuable technology. Its units include Flipkart, which sells general merchandise, Tundra, a retailer of clothing and accessories, the Jabong and PhonePe fashion portal app app. Walmart has said he could make an initial public offer of Flipkart publicly within the next four years.
He said a separate source directly on the issue in India, who did not wish to be named, that Chancellor is still a shareholder in Flipkart and has not expressed any desire to sell his benefit. Walmart has not offered to buy it, he added the source.
Walmart said that Bansal had been considering bridging for some time and that the companies had been working with each other on a succession plan, which had now accelerated. In his note to Flipkart employees, Binny Bansal said he had recently thought that he could continue as CEO for "a few more quarters."
Kalyan Krishnamurthy, leading the company's leading Flipkart e-commerce, said now acting as chief executive for a wider group of businesses, including Myntra and Jabong's clothing websites, said Walmart
Ananth Narayanan, who is the CEO of Myntra and Jabong, will continue in those roles and will now report to Krishnamurthy.
Social media The movement against the sexual harassment that began in the United States over a year ago has won a traction in India in recent weeks.
Walmart shares traded 1.15 per cent at $ 102.68 (approximately Rs, 7,400) per share in the field of afternoon trade.
© Thomson Reuters 2018
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