Paytm Singapore Offloads Japan's PayPay Stake to SoftBank Vision Fund 2 for USD 279.2 Mn The sale proceeds will bolster the cash reserves of Paytm's parent company, One97 Communications, enhancing its ability to pursue future business initiatives focused on creating shareholder value.
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Paytm Singapore, a subsidiary of Paytm, has secured board approval to sell its stock acquisition rights in Japan's PayPay to Softbank Vision Fund 2 for USD 279.2 million (INR 2,364 crore). This move marks a strategic monetisation for Paytm, which had initially invested in PayPay in 2018 as a technology partner.
PayPay, a joint venture launched by SoftBank Corp and Yahoo Japan Corporation, leveraged Paytm's technology expertise to drive Japan's mobile payment revolution.
Paytm Singapore spokesperson said, "We are grateful to Masayoshi-san and the PayPay team for giving us the opportunity to together create a mobile payment revolution in Japan. We remain fully committed and will continue to support PayPay's product and technology innovations in the future. We are working on introducing new AI-powered features to accelerate PayPay's vision in Japan."
The sale proceeds will bolster the cash reserves of Paytm's parent company, One97 Communications, enhancing its ability to pursue future business initiatives focused on creating shareholder value. The company's consolidated cash balance stood at INR 9,999 crore as of September 2024.
This is Paytm's second significant divestment this year, following the August sale of its entertainment ticketing business to Zomato for INR 2,048 crore. The financial gains from these transactions have contributed to a turnaround in Paytm's profitability.
In Q2 FY24, the company reported a net profit of INR 930 crore, a sharp reversal from the INR 840.1 crore loss in the preceding quarter, aided by the ticketing business sale. Additionally, Paytm's revenue from operations rose 10.51% quarter-on-quarter to INR 1,659.5 crore.
The stake sale underscores Paytm's strategy of optimising assets to strengthen its financial position, fueling its ambitions in India's competitive fintech landscape while continuing to support global partners like PayPay.
