SoftBank-backed One97 Communications, the parent of digital payments startup Paytm, on Friday filed a draft prospectus with the market regulator. I myself This suggests that the total planned mobilization through the offer will be shared equally by the existing shareholders who are selling through the offer (Rs 8,300 crore) and the company, which will issue new shares (Rs 8,300 crore).
So far, the Rs 15,475 crore IPO for state-run coal mining major Coal India, which closed in October 2010, is the biggest IPO in Indian history. Of the top five Indian IPOs, three – Coal India, GIC (Rs 11,176 crore in 2017) and New India Assurance (Rs 9,600 crore in 2017) – had government offers for disinvestment. the other two are Reliance Power (Rs 11,700 crore in 2008) and SBI Cards (Rs 10,355 crore in 2020).
The largest fund raising through the stock market route by an Indian company was the rights offer: In June 2020, Reliance Industries It had successfully closed its Rs 53,125 crore rights offer.
According to the draft prospectus, Noida-headquartered Paytm, which was last valued at $16 billion, will use Rs 4,300 crore of IPO proceeds to acquire consumers and merchants to strengthen its ecosystem. It will use another Rs 2,000 crore to invest in new business initiatives and acquisitions.
Startup, which counts China’s Ant Group and Alibaba, Japan’s softbankElevation Capital (formerly Saif Partners) and Warren Buffett-led Berkshire Hathaway, among its supporters, will see most of these early investors sell off part of their stake in the company.
Ratan Tata, Chairman Emeritus, Tata Group, too, is expected to sell his stake, which is less than 0.5% of the company, while founder Vijay Shekhar Sharma will also reduce his stake.
Paytm’s largest shareholder, Ant Group, along with its parent Alibaba Group holds about 37% stake. The two entities together are expected to reduce their stake below 25% to enable Paytm to become a “professional managed company” under SEBI guidelines.
Sharma, who holds around 14% stake in Paytm, has also transferred his 5% stake VSS Holding, a company which he wholly owns. The holding entity has got approval from One97 Communications to take a loan of Rs 492 crore.
will be put into the fund Paytm InsureTech, an affiliate of One97 Communications, which in turn will use them to acquire Raheja QBE General Insurance. Paytm had entered into an agreement in July 2020 to buy Raheja QBE General Insurance. The proposed deal is awaiting regulatory approval. Paytm, however, clarified that there is no certainty whether the transaction will proceed or not.
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