According to Reuters, a subsidiary of Ant Group will sell a 10.3% stake in Paytm, India’s largest payment platform, and Paytm’s founder and CEO Vijay Shekhar Sharma will increase its stake. To simplify the company’s ownership structure.
Ant Group (Netherlands) Holding Co., Ltd. stated in a document on Monday that the company will sell 10.3% of its shares to the founder of Paytm for US$628 million (currently about RMB 4.509 billion) and CEO Vijay Shekhar Sharma. After the news was announced, Paytm’s stock price rose as much as 11.4%, and the company’s stock price has risen by more than 50% this year.
Sharma’s purchase of shares from Ant Group (Netherlands) Holdings Ltd was priced at RMB 796.6 each, the same as Paytm’s closing price in the previous session. After this transaction, Ant Group will no longer be the largest shareholder of Paytm, with its shareholding ratio reduced to 13.5%. In February this year, Alibaba Group sold its entire stake in Paytm. Japan’s SoftBank Group also reduced its stake in Paytm through secondary market transactions, with its stake down to 9.18% after the latest transaction.
Paytm said Sharma will become the company’s largest shareholder with a 19.42 percent stake. The company also said the transaction involved no cash payment and did not require any collateral, guarantee, or other assurance of value from Sharma. There will also be no change in management and control of the company, with Sharma and the existing board remaining in their roles. Resilient Asset Management, an overseas entity owned by Sharma, will issue convertible bonds to Ant Group as consideration for the acquisition.
Paytm is India’s largest mobile payment and commerce platform with over 300 million users and 21 million merchants. The company provides a variety of online payment, e-commerce and financial services, including wallets, banking, insurance, loans and investments, among others. The company was listed on the Bombay Stock Exchange in November 2021, making it the largest initial public offering (IPO) in Indian history.
