Reliance Capital sells 1% stake in Paytm for Rs 275 crore
BENGALURU: Reliance Capital has sold its 1% stake in online payments and mobile wallet service provider Paytm to Chinese e-commerce giant Alibaba and its payments affiliate Ant Financial for Rs 275 crore, according to one source familiar with the matter.
The financial services arm of Reliance Group had invested Rs 10 crore for this stake in Paytm.
The investment was made by the Anil Ambani-led financial services entity in 2010 ahead of the proposed IPO for Paytm owner One97 Communications, which was later aborted.
Reliance Capital holds 1% stake in Paytm at current date and had been in conversations with multiple buyers for the sale for over a month now. The partial sale of its stake has resulted in over 25 times gains for the ADAG Group firm.
Paytm, whose parent One 97 is valued at $4.8 billion, did not comment on the current transaction.
The move by Alibaba and Ant Financial, who together own a 40% stake in One 97 Communication, to consolidate their holding comes after they recently hiked stake in the online retail unit. Alibaba Group led $200 million round in Paytm E-commerce, which was demerged from One 97, earlier this month. The e-commerce portal will be fashioned after Alibaba's digital platform in China called TMall.
Other suitors have also been eyeing a secondary stake in One 97 Communications, though these discussions have not resulted in a transaction yet.
In January ET reported that Sunil Munjal, the chairman of Hero Corporate Services, the insurance redistribution and IT services arm of the Hero Group, and Saroj Poddar, chairman of fertiliser and engineering services conglomerate Adventz Group, are negotiating a stake purchase from early investor and former IDFC Securities analyst Nikhil Vora.
Paytm founder Vijay Shekhar Sharma sold 1% of his shareholding in the parent company One97 Communications in December for Rs 325 crore to raise money for the payments bank entity. Paytm Payments Bank will also launch its operations by end of fiscal 2016-17.
One 97 is targeting a strong offline push to on-board 10 million merchants by December 2017 and has committed to investing close to Rs 600 crore to develop the backend for its QR code based payments features for the offline merchants. The company crossed 200 million wallet users in February.
The financial services arm of Reliance Group had invested Rs 10 crore for this stake in Paytm.
The investment was made by the Anil Ambani-led financial services entity in 2010 ahead of the proposed IPO for Paytm owner One97 Communications, which was later aborted.
Reliance Capital holds 1% stake in Paytm at current date and had been in conversations with multiple buyers for the sale for over a month now. The partial sale of its stake has resulted in over 25 times gains for the ADAG Group firm.
Paytm, whose parent One 97 is valued at $4.8 billion, did not comment on the current transaction.
The move by Alibaba and Ant Financial, who together own a 40% stake in One 97 Communication, to consolidate their holding comes after they recently hiked stake in the online retail unit. Alibaba Group led $200 million round in Paytm E-commerce, which was demerged from One 97, earlier this month. The e-commerce portal will be fashioned after Alibaba's digital platform in China called TMall.
Other suitors have also been eyeing a secondary stake in One 97 Communications, though these discussions have not resulted in a transaction yet.
In January ET reported that Sunil Munjal, the chairman of Hero Corporate Services, the insurance redistribution and IT services arm of the Hero Group, and Saroj Poddar, chairman of fertiliser and engineering services conglomerate Adventz Group, are negotiating a stake purchase from early investor and former IDFC Securities analyst Nikhil Vora.
Paytm founder Vijay Shekhar Sharma sold 1% of his shareholding in the parent company One97 Communications in December for Rs 325 crore to raise money for the payments bank entity. Paytm Payments Bank will also launch its operations by end of fiscal 2016-17.
One 97 is targeting a strong offline push to on-board 10 million merchants by December 2017 and has committed to investing close to Rs 600 crore to develop the backend for its QR code based payments features for the offline merchants. The company crossed 200 million wallet users in February.
