To tap into Indian growing e-commerce industry, Alibaba Group’s finance arm, Ant Financial has agreed to buy 25% stake in One97 Communications Ltd., owner of an online payments processor Paytm, for an undisclosed deal amount.
In January 2015, there was a news that Alibaba Group and Temasek Holdings are planning to invest USD 575 million in this company, against a 30% stake. This update appears to be a part of the same deal. Company’s Founder and CEO, Vijay Shekhar Sharma confirmed the news in a Facebook post.
Alibaba raised a record USD 25 billion in an initial public offering in September 2014. Ant Financial has an estimated value of about USD 50 billion and is planning to go public next year. With this investment, Ant Financial which also runs Alipay Wallet has more than 190 million users, will provide Paytm with strategic and technical support for its business.
One97 was launched in 2000, it provides mobile content, advertising and commerce services. It is backed by investors like SAIF Partners, Intel Capital, SAP Ventures and Silicon Valley Bank.
The firm had recently acquired Bangalore based Plustxt Mobile Solutions along with the launch of new app for online bus ticketing on Paytm Android and iOS app. Also, it invests in early stage mobile companies out of its own initiative, One97 Mobility Fund (OMF).