Vijay Shekhar Sharma buys 10% stake in Paytm worth $628m from Antfin
Vijay Shekhar Sharma, founder and CEO of the Indian financial services firm Paytm, has agreed to purchase 10.3% of Ant Financial’s (Antfin) stake in his firm.
Vijay Shekhar Sharma boosts stake in Paytm
The off-market deal is to be completed through Sharma’s 100%-owned Netherlands-based entity, Resilient Asset Management, with the value of the acquired stake, which includes ownership and voting rights, estimated to be worth around $628 million.
Instead of being paid for in cash, Resilient will complete the acquisition by issuing Antfin with optionally convertible debentures (OCDs), a form of debt securities that enables Antfin to retain the economic value of the stake.
Once completed, Sharma’s shareholdings in Paytm will increase to 19.42%, while Antfin, being an affiliate company of the Chinese conglomerate Alibaba Group, will have its shareholding reduced to 13.5%. In addition to this, there is to be no Antfin nominee on the board of Paytm.
The deal is thought to signal the further unravelling of Paytm’s once-close relationship with Antfin.
Antfin and its parent company Alibaba were early investors in Paytm Mall, the firm’s online marketplace, but later sold their combined 43% shares in the company back to Paytm E-commerce in May 2022, citing India’s evolving online business space, the pandemic and wider competition as the reasons behind the decision.
Then in February of this year, reports indicated that Antfin was mulling the sale of its stake in the firm, which was itself considering a merger with the Indian telecom giant Bharti Airtel. However, the merger was later abandoned.
Speaking on the firm’s latest transfer of ownership, Sharma expresses his pride in the firm’s role “as a true champion of made-in-India financial innovation, and our achievements in revolutionising mobile payments and contributing to formal financial services inclusion in the country”.
