Ant Financial Services Group, an affiliate of China’s Alibaba Group Holding Ltd., has agreed to acquire a 25 percent stake in Indian payment services provider One97 Communications, Reuters reported.
The companies did not say how much the deal was worth, but the news agency quoted a source as saying that it was worth more than US$500 million with an option for Ant to boost its stake next year. One97 is planning a public listing.
The deal values One97 at more than US$2 billion, making it one of the most-valuable start ups in the country. One97 runs Paytm, an online platform where users can shop or pay utility bills, It has about 23 million users.
Ant runs Paytm’s Chinese counterpart Alipay.
Paytm has benefited from the spread of affordable handsets and internet connectivity which has turned India into the fastest-growing smartphone market in the Asia-Pacific region, according to researcher IDC.
“This partnership between Ant Financial Services Group and Paytm will foster the growth of India’s digital payment ecosystem,” the companies said in a joint statement.
Ant, investing in an Indian company for the first time, will provide Paytm “with strategic and technical support for its business”, the companies said.
Citigroup and Goldman Sachs advised One97 on the deal, the report said.
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