"Last night, (they) reached a final agreement and it was decided that Flipkart will be sold to America's Walmart," said SoftBank CEO Masayoshi Son, whose firm owns a 20 percent stake in Flipkart.
He said SoftBank's $2.5 billion (roughly Rs. 16,800 crores) stake in the company would be worth $4 billion (roughly Rs. 27,000 crores) with the acquisition.
The deal, reportedly worth around $15 billion (roughly Rs. 1 lakh crores), is expected to be announced officially later Wednesday, with Walmart CEO Doug McMillon in Bengaluru, where Flipkart is headquartered.
Walmart is expected to acquire around 70 percent of the Indian e-tailer in a deal analysts said would be the world's biggest e-commerce acquisition and pit Walmart against rival Amazon in one of the world's fastest growing markets.
Amazon has been expanding aggressively since it entered the Indian market in 2013.
There has been months of speculation that Walmart was preparing to buy Flipkart but both have repeatedly declined to comment on the talks.
Last week, Flipkart's board agreed to sell up to 75 percent of the company to a Walmart-led group, according to multiple media reports.
The deal is expected to value Flipkart at around $20 billion (roughly Rs. 1.34 lakh crores).
Google's parent company Alphabet is also expected to purchase a small stake, possibly around 10 percent, reports said, citing unnamed sources familiar with the matter.
Flipkart is India's largest e-commerce group on the basis of sales but has been fighting off a huge challenge from Amazon.
Amazon boss Jeff Bezos has committed more than $5 billion to grabbing a big slice of India's e-commerce pie after failing to make inroads in China.
E-commerce sales in India hit $21 billion (roughly Rs. 1.41 lakh crores) last year according to market research company Forrester, and are expected to soar as its population of 1.25 billion people make greater use of internet access.
Flipkart was founded in 2007 by former Amazon employees Sachin Bansal and Binny Bansal, who are not related.
Like Amazon, it started as an online bookstore. Flipkart now sells everything from mobile phones, televisions and juicers to running shoes, sofas and beauty products.
SoftBank acquired its stake in the company last year through its Vision Fund investment arm.