Following the completion of the transaction, Paytm founder and CEO Vijay Sharma’s direct and indirect shareholding in the India-based financial technology company will increase to 19.42% while the shareholding of Antfin will decrease to 13.5%
Paytm headquarters in Noida, India. (Credit: Lakshmisreekanth/Wikimedia Commons)
Vijay Sharma, the founder and CEO of One 97 Communications (Paytm), is set to increase his stake in the Indian payments company to 19.4% via a deal valued at $628m with Antfin (Netherlands).
The additional stake of 10.3% in Paytm will be bought by Sharma through an off-market transfer by using his fully-owned overseas entity Resilient Asset Management.
According to the terms of the agreement, the Netherlands-based Resilient Asset Management will be transferred more than 65 million shares of Paytm by Antfin.
Following the completion of the transaction, the shareholding of Antfin will decrease to 13.5%.
Besides, Resilient Asset Management will acquire ownership and voting rights of the acquired 10.3% block.
As consideration for the deal, the overseas entity of Sharma will issue optionally convertible debentures (OCDs) to Antfin. This, in turn, will enable the latter to retain the economic value of the divested stake.
Sharma said: “I am proud of Paytm’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.
”As we announce this transfer of ownership, I would like to express my sincere gratitude to Ant for their unwavering support and partnership over the past several years.”
The deal will not involve any cash payment nor any pledge, guarantee, or other value assurance by Sharma, either directly or otherwise.
Through the transaction, Antfin will cease to be the largest shareholder of Paytm.
The Indian financial technology company expects to benefit from the new ownership structure.
Paytm also said that that the company’s management and control will remain unaffected, and that Sharma and the current board will retain their positions and responsibilities.