SoftBank and Alibaba buy into Indian online retailer
Deal with India’s Paytm E-Commerce values the e-commerce outfit at about $1.9 billion
SoftBank Group is investing $400 million in India’s Paytm E-Commerce in a funding round that will value the online retailer at about $1.9 billion, a regulatory filing showed on Monday.
Alibaba, an existing investor in Paytm E-Commerce, is also putting in $45m in the round, the filing showed.
SoftBank, which is among major investors in India’s fast-growing e-commerce sector and already owns a stake in Paytm’s parent, confirmed investing in Paytm Mall, the brand name under which Paytm E-Commerce operates an online market place.
“We believe Paytm Mall’s offline-to-online operating model, combined with the strength of the Paytm ecosystem, is uniquely positioned to enable India’s 15 million offline retail shops to participate in India’s e-commerce boom,” SoftBank said.
Amit Sinha, chief operating officer of Paytm Mall, said his company would deploy the latest investment from SoftBank and Alibaba to beef up its technology and build superior logistics among other things.
A filing with India’s Registrar of Companies showed SoftBank units will get a 21.1 per cent stake in Paytm E-Commerce after the investment which would come in four tranches.
Alibaba.Com Singapore E-Commerce, which currently owns 36.3 per cent of the Indian e-retailer, will remain the single-largest shareholder of Paytm E-Commerce but with a relatively smaller stake of just over 30 per cent after its latest investment is completed in four tranches.
Paytm E-Commerce competes with Amazon’s Indian unit and home-grown Flipkart. A group company of Paytm’s parent One97 Communications runs India’s biggest digital wallet services and also has a stake in a payments bank.
Updated: April 3, 2018 08:54 AM