Temasek-backed Pine Labs buys India gift card solutions provider Qwikcilver for US$110m

TEMASEK-BACKED Pine Labs has acquired Indian gift card solutions provider, Qwikcilver for US$110 million, subject to closing conditions. The purchase was funded from the company's cash reserves and additional funding from existing investors, the point-of-sales solutions company, which is also India-based, said on Tuesday.

Qwikcilver is a full-stack gift card service provider; it services nine out of every 10 gift cards in India and manages an annualised gross transaction value of US$1.5 billion across India, the Middle East and South-east Asia.

The acquisition will bring together Pine Labs' merchant-focused and Qwikcilver's brand-focused software-as-a-service (SaaS) technology platforms. Subsequently, Pine Labs will use Qwikcilver's technology and marketplace expertise to scale up its own gift solutions business - Pine Perks - which was started four years ago. Likewise, Qwikcilver will leverage Pine Labs to scale.

Vicky Bindra, chief executive officer, Pine Labs, said: "We see excellent complementary strengths between the Pine Labs' and Qwikcilver's gift businesses. While Pine Labs has a strong merchant network, Qwikcilver has market-leading processing and distribution capability."

Mr Bindra added according to market estimates, gift, as a category, is growing at a "high double-digit rate annually".

Kumar Sudarsan, co-founder and CEO of Qwikcilver, will also join the Pine Labs leadership team after transaction closes.

Following the acquisition, Qwikcilver shareholder Sistema Asia Fund said in a separate announcement that it has sold its stake inthe company, citing "multifold returns within three years of its investment". It did not disclose how much its stake in Qwikcilver was valued at. The fund previously led Qwikcilver's Series B round of funding, which was a US$10 million dollar round. Qwikcilver is also the fund's first exit and monetisation.

Sistema Asia Fund is a venture capital fund sponsored by Sistema PJSFC, a publicly-traded diversified Russian holding company. It is managed by Sistema Asia Capital, a Singapore-based fund managing firm.

Last year, Singapore investment company Temasek Holdings and online payments giant PayPal acquired minority stakes in Pine Labs for US$125 million.