E-commerce group Alibaba and its affiliate Ant Financial have invested about $680m in India-based online payment technology provider One97 Communications and will jointly hold a 40% stake, the Economic Times reported today.
One97 is the owner of Paytm, the online payment services provider that began life in 2008 as a mobile phone payment top-up service before expanding to a mobile wallet service as it grew.
Ant Financial, which oversees much of China-based Alibaba’s financial services offerings, paid a reported $575m for a 25% stake in One97 in February this year.
Alibaba’s latest investment includes the outstanding $375m from the February deal and will see Ant’s stake lowered to 20%, while Alibaba’s share now also stands at 20%, according to a person familiar with the deal.
The share in One97 held by venture capital firm SAIF Partners will be diluted from 37% to 30% in the transaction, and managing director Vijay Shekhar Sharma’s stake has fallen from 27% to 21%.
One97 raised $28m from semiconductor technology manufacturer Intel, Sapphire Ventures, which was originally spun out from enterprise software producer SAP, SAIF and Silicon Valley Bank before securing an additional $60m from SAIF in November 2014.
One97 will invest the cash in developing its technology, marketing and hiring as it seeks to scale its operations, and furthering its expertise in online-to-offline business. It plans to grow its business model to incorporate the sale of cinema and entertainment event tickets.
The company also intends to build on its $10m investment in logistics technology developer LogiNext Solutions last week by funding up to a dozen additional startups.