Vijay Shekhar Sharma, founder and chief executive officer of One 97 Communications, is poised to purchase a 10.3 per cent stake in Paytm from Antfin (Netherlands) Holding BV, as the company notified the exchanges on Monday.
According to the company’s regulatory filing, Sharma will acquire the stake in Paytm through his wholly-owned overseas entity, Resilient Asset Management BV. The agreement will elevate Sharma’s shareholding in Paytm to 19.42 per cent. Conversely, Antfin’s shareholding will diminish to 13.5 per cent, thus surrendering its status as the largest shareholder in the company.
At present, Antfin holds a 23.79 per cent stake in Paytm.
The value of the 10.3 per cent stake that Sharma is primed to acquire is estimated at $628 million, based on the closing price as of 4 August 2023. Furthermore, in line with the agreement, Antfin will transfer nearly 65 million shares of the financial technology giant to Resilient, Sharma’s entity.
The agreement stipulates that Resilient will acquire ownership and voting rights of the 10.3 per cent block.
Additionally, Sharma’s entity, Resilient, will issue Optionally Convertible Debentures (OCDs) to Antfin, enabling it to retain the economic value of the 10.3 per cent stake.
“Accordingly, no cash payment will be made for this acquisition, nor will any pledge, guarantee, or other value assurance be provided by Sharma, either directly or indirectly,” stated the company in a regulatory filing on Monday.
This transaction will not alter the management at Paytm, with Sharma remaining as the company’s managing director and chief executive officer. Additionally, there is no Antfin nominee on Paytm’s board.
“Paytm has been a true champion of made-in-India financial innovation and has made remarkable contributions to revolutionising mobile payments and advancing formal financial services inclusion in the country. As we announce this transfer of ownership, I wish to extend my sincere gratitude to Ant for their steadfast support and partnership over the past several years,” Sharma commented.
Resilient Asset Management BV, owned by Sharma, is based in the Netherlands.