After saving giant Indian startups Flipkart and Ola from a funding crisis, SoftBank is now looking to invest and buy equity stakes in Mobile Wallet startup Paytm. The deal might be a strategic move by softbank to consolidate and merge snapdeal with paytm. Earlier this week softbank was trying to merge snapdeal with flipkart, which might not have gone through as expected.
According to people familiar with both the firms, SoftBank Group Corp. to raise $1.2-1.5 billion in cash in a deal that could raise Paytm’s valuation to $7-9 Billion. Paytm is currently owned by One97 Communications which is an E-Commerce arm of Chinese Internet Gaint Alibaba Group.
The current valuation Paytm is about $5.9 Billion which includes investors like Ant Financial, Reliance Capital, SVB (Saama Capital), SAP Ventures, Mountain Capital and much more.
In October last year, SoftBank said it would launch a $100-billion tech-focussed global fund, called the SoftBank Vision Fund, along with Saudi Arabia’s sovereign wealth fund Public Investment Fund and other investors.
According to one of the three sources, SoftBank is currently focused in closing the funding round with Flipkart and are in talks with Paytm. If the funding takes place, SoftBank would join Alibaba, in which the Japanese group holds a 30 per cent stake that represents its most successful investment.
Both Softbank and Paytm haven’t responded to queries asked by the media.
One of the source said, “Getting SoftBank will help Paytm change the perception of being a Chinese company with the regulators as well as the public.” Read more about Paytm.
Want to be a guest author? Register Here to share your business knowledge with our readers.