As part of its decision to separate full ownership of payments and financial services unicorn PhonePe, Flipkart will pay out cash payouts to employee stock option holders totaling about $700 million. The e-commerce giant is doing this in an effort to retain talent at a time when most startups in the nation are making layoffs due to the ongoing funding winter.

“We are happy to announce that as part of the deal, workers who have ESOPs (employee stock option plans) will receive a one-time discretionary cash payout. According to the Flipkart options, this dividend represents the value of the PhonePe holding ” CEO Kalyan Krishnamurthy informed staff members via internal mail.

What’s behind Flipkart announcing PhonePe hive off:

“Without taking into account the value of PhonePe, the new share price of Flipkart has been established at $165.83 per option (formerly $189.1). However, due to the rise in PhonePe’s market value, the dividend to employees will be US$43.67 per option “Added Krishnamurthy.

Although Krishnamurthy did not specify the whole cost of the buyback, a source familiar with the situation told that it will be $700 million. He added that the workers who would qualify for the buyback will soon receive further information and specifics on this reimbursement. Unknown is the precise number of employees who will get the compensation. Flipkart made no comments regarding the report. In December 2020, Flipkart separated PhonePe into a new company. Back then, with a valuation of $5.5 billion, PhonePe secured $700 million from a number of investors, including Walmart.

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