PhonePe in talks to buy Indus OS for $60 million

PhonePe did not respond to FE’s queries.

PhonePe is in advanced discussions to acquire homegrown mobile platform Indus OS in a $60-million all-cash deal, sources in the know told FE.

If the negotiations are settled well in time, the deal could close in the next four to eight weeks, they said.

PhonePe did not respond to FE’s queries.

The rationale behind the acquisition is to bolster the play of the Walmart-owned fintech firm’s in-app platform Switch. Switch allows users to use an array of apps including shopping, grocery, travel and entertainment from within the PhonePe app. Switch currently hosts more than 350 partner apps. Indus OS runs android app store Indus App Bazaar that claims to have over 100 million users and has a network of more than 400,000 apps. The service is also available in 12 local languages, thereby making it easy for non-English speaking users to navigate the app store. The deal has the potential to help PhonePe get more apps on to the Switch platform. Besides, the tech expertise of Indus OS will also come in handy. “PhonePe’s super app ambitions are known. The acquisition may be a step towards that,” said one of the sources.

As far as Indus OS is concerned, the transaction with PhonePe will give it access to the company’s wide customer base (registered users) of about 290 million. The firm also stands to gain from PhonePe’s sound financial standing.

Sources said the two companies are working out the modalities of integrating the workforce and other administrative issues.

This will be PhonePe’s second acquisition after Zopper Retail, a hyper local point of sale platform for small and medium businesses in July 2018.

Indus OS was founded in 2013 by three IIT alumni Rakesh Deshmukh, Akash Dongre and Sudhir B.