Walmart CEO Doug McMillon said Thursday that Amazon will be paid a $3 billion settlement with the Federal Trade Commission to avoid a potential antitrust investigation.
McMillon told The Associated Press that the deal, announced Thursday, is expected to be finalized by the end of the year.
The payment, which is tied to a proposed antitrust settlement, is a first step toward closing the transaction.
Walmart is the largest U.S. retailer, but it faces fierce competition from online competitors such as Amazon, which has made large investments in its online grocery business.
Mcmillon said Amazon will also receive “significant payments” from the merger that could be worth more than $4 billion in 2019.
McDonald’s will get $3,000 in payments from Amazon, but Amazon will receive more than a million payments from Walmart, McMillon wrote in a memo to shareholders.
The $3 million will be divided between the two companies.
Walton B. Ford Jr., the chairman and CEO of Walmart, announced last month that he would sell Walmart’s $12.2 billion stake in Walmart to Amazon for $3 to $4 a share.
McMillon said the deal will allow Amazon to “make significant investments in Walmart’s retail operations, including in its fulfillment centers and distribution centers.”
Walmart’s shares rose as much as 1.5 percent to $58.99 in after-hours trading, after the news was first reported by the Wall Street Journal.