In what could be the single-largest investment in an Indian e-commerce company, Paytm is in talks to raise Rs.12,000 crore from Japanese MNC SoftBank. The deal, if it materialises will value Paytm at $9 billion.
It is no secret that SoftBank is eyeing the Indian e-commerce segment, having initiated talks to sell Snapdeal (it is the single largest shareholder in Snapdeal) to Flipkart.
While there are no official confirmations about the deal, sources suggest that SoftBank would get a 20 per cent stake in Paytm, with the deal likely to take around a month to materialise.
Paytm is eyeing the finance and banking sector, with a vision to invest Rs.10,000 crore into the segment by 2020. The investment would help the company launch its payment bank, for which it has already received approval from the RBI.
SoftBank, led by Masayoshi Son has looked at the Indian market to be the next big thing, having already invested over $2 billion in companies like Snapdeal, Grofer, OYO, and Ola. It has committed to an investment of $10 billion in India over the next five years, despite facing losses to the tune of $350 million in Snapdeal and Ola.
Paytm, which has seen a huge surge in its valuation following demonetisation will aim to strengthen its position, with the new investment making it India’s second biggest internet company.
In a bid to expand its portfolio, Paytm is also offering wealth-management solutions wherein individuals can purchase gold for as little as Re.1. Titled ‘Digital Gold’, it enables investors to buy, sell, or store gold using their Paytm wallets.