BY Saritha Rai for Bloomberg
Indian digital-payments and e-commerce startup Paytm is raising $300 million in a funding round led by Taiwan’s MediaTek Inc. and other investors, more than doubling its valuation to $5 billion, a person with knowledge of the matter said.
Paytm’s existing investors Alibaba Group Holding Ltd., its payments affiliate Ant Financial and venture fund SAIF Partners participated in the financing, said the person, who asked not to be identified because the information isn’t public.
The funds will go to Paytm’s parent One97 Communications Ltd., its digital payments company Paytm Commerce Ltd. and subsidiary Paytm Payment Bank Ltd. Chinese conglomerate and investor Fosun International Ltd. is also in advanced talks to join as an investor within a few weeks, the person said. The financing is a bright spot for venture investments in India, which have slowed after surging to a record $8.9 billion in 2015, according to the research firm Preqin. The pace dropped to $2.7 billion in the first two quarters, the London firm said.
A representative for One97 declined to comment. The company was recently restructured in line with regulatory requirements, separating its digital-payments bank from its commerce platform. The digital bank is to start operations in the next few months.
Paytm, which is based in Noida outside New Delhi, was founded by entrepreneur Vijay Shekhar Sharma and was first known as an e-commerce platform that competed with Flipkart Online Services Ltd. and Snapdeal, which are backed by global investors including Accel Partners, SoftBank and Russian billionaire Yuri Milner’s GST Global.
One97 will now focus on services such as travel and movie ticketing, while the marketplace and the payments bank will focus on their businesses. With the latest funding, Sharma is diluting his 51 percent stake in Paytm Payments Bank to existing investors including Alibaba and Ant Financial, the person said.
First appeared at Bloomberg