SoftBank, Alibaba invest $445m in India’s Paytm

SoftBank will commit $400 million, while Alibaba will provide the rest, according to filings with the Registrar of Companies cited by the Economic Times. The investment is expected to raise Paytm Mall’s valuation to nearly $2 billion and give SoftBank and Alibaba stakes of 21% and 46%, respectively.

Paytm Mall will use the new capital to enhance its brand and improve the experience of buyers and sellers on its online marketplace through technology and logistics upgrades. The entity was created in 2016 by Paytm to differentiate its online marketplace from the better-known electronic wallet, which was later incorporated into Paytm Payments Bank.

Both SoftBank and Alibaba are existing investors in Paytm Mall and its parent company One97 Communications. Alibaba’s online finance affiliate Ant Financial Services Group bought a 25% stake in One97 in 2015, while Alibaba bought a 20% stake in Paytm Payments Bank later that year after it was spun out by One97. Last year Alibaba and SAIF Partners invested $200 million in Paytm Mall.

SoftBank also invested in One97 last year, committing a reported $1.4 billion. The purchase included $400 million worth of shares from SAIF and One97 founder Vijay Sharma. At the time it was said to be the largest round from a single investor in India’s VC industry.

Paytm is one of several Indian e-commerce companies backed by SoftBank. The Japanese investor committed several rounds of funding to online marketplace Snapdeal before the company’s founders scuttled a planned sale to its chief domestic rival Flipkart that was reportedly brokered by SoftBank. SoftBank has since announced plans to invest $2.5 billion in Flipkart.

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• Topics
• South Asia
• Technology
• Consumer
• Expansion
• India
• Softbank
• Alibaba Group
• TMT
• Growth capital