Amazon India has initiated formal talks with Kishore Biyani’s Future Group to invest around $600-700 million, reported the Business Standard.

The company is looking to buy around 12 to 15 percent stake in the retail major, reported BS on Monday.

A term sheet has been signed by the two entities, indicating that the two have officially entered a pact.

"A term sheet between Amazon and Future has been signed. While the discussion is for a minority stake in the range of 10 to 15 percent, it might be increased. The two firms have begun the process of negotiations, " a source was quoted in the report.

The development comes soon after Walmart concluded a deal with Flipkart, buying a 77 percent stake in the latter.

According to the report, if the deal is finalised, it is likely to be a combination of cash and stocks.

When asked by the paper, Future Group denied signing the term sheet, while Amazon refused to comment on the same, the report added.