SoftBank Group unit seeks up to US$215m in Paytm stake sale
A unit of Japan’s SoftBank Group is selling a 4.5 per cent stake in the parent of India’s leading digital payments brand Paytm, seeking to pare back its holding in a company whose share has tumbled 72 per cent since its initial public offering (IPO) last year.
SVF India Holdings (Cayman) is offering 29 million shares of One 97 Communications at 555 rupees (S$9.3) to 601.45 rupees each, according to terms of the deal obtained by Bloomberg News. At the low end of that range, it would be selling at a 7.7 per cent discount to the firm’s on Wednesday (Nov 16) close.
Paytm is among a number of Indian startups that went public last year amid a boom in IPOs and zest for the country’s tech sector that have since suffered a slump in market value.
When Paytm’s founder Vijay Shekhar Sharma pulled off the IPO last November, it was the largest seen in the Indian market up to that point. The company raised 183 billion rupees, but its shares went on plummet in what would become one of the Indian bourse’s worst-ever debuts as investors shunned its high valuation and loss-making startup status.
SoftBank is one of Paytm’s biggest shareholders, along with Alibaba Group Holding and its fintech affiliate Ant Group. After the sale, it will hold roughly 12.9 per cent of the company.
The world’s biggest technology investor has been grappling with declines on its portfolio of more than 400 investments in both public and private tech companies around the world. Its core Vision Fund segment posted a US$7.2 billion loss in the July-September quarter, following a record 2.33 trillion yen (S$22.9 billion) loss in the preceding period.
The lock-up period on US$4.3 billion worth of Paytm shares expired on Tuesday, freeing investors to sell shares after they endured a year in which the company shed more than US$12 billion of market value.
FSN E-Commerce Ventures, owner of beauty e-retailer Nykaa has seen selling by some holders, including private equity firm TPG, since a lock-up on its shares ended last week.
Meanwhile, food-delivery company Zomato plunged to a record low in July when a lock-up on its shares expired. Zomato’s successful IPO last year had set the tone for a generation of buoyant Indian unicorns to make their stock market debuts. BLOOMBERG
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