Vijay Shekhar Sharma, founder and CEO, Paytm
The company in the exchange filing said, ”Our associate company, Paytm Insuretech Private Limited, had entered into a share purchase agreement to acquire 100% of Raheja QBE General Insurance Company Limited. As the share sale and purchase transaction has not been consummated within the time period envisaged by the parties under the said agreement, the agreement has automatically terminated”
Paytm said it remains bullish on its roadmap for general insurance, ”and we intend to seek requisite approvals for a new general insurance license, wherein we hold a 74% majority shareholding upfront’
According to the new plans, Paytm will hold 74 per cent while Vijay Shekhar Sharma, founder and CEO, Paytm will will hold the rest of the stake.
Together, they will invest around Rs 1000 crore in the new general insurance venture
New Delhi:
After dropping plans to acquire Raheja QBE General due to regulatory hurdles, Paytm said it will seek a nod for a new general insurance license with a fresh application, aimed at gaining majority shareholding with a 74 per cent upfront equity stake.
However, Paytm said it remains bullish on its roadmap for general insurance, ”and we intend to seek requisite approvals for a new general insurance license, wherein we hold a 74% majority shareholding upfront.”
The company will file for a new application, where One 97 Communications Ltd — the parent firm of Paytm — will have a direct majority shareholding instead of the earlier proposed fully diluted shareholding of 11 per cent.
According to the new plans, Paytm will hold 74 per cent while Vijay Shekhar Sharma, founder and CEO, Paytm will will hold the rest of the stake.
Together, they will invest around Rs 1000 crore in the new general insurance venture.
The company in the exchange filing said, ”Our associate company, Paytm Insuretech Private Limited, had entered into a share purchase agreement to acquire 100% of Raheja QBE General Insurance Company Limited. As the share sale and purchase transaction has not been consummated within the time period envisaged by the parties under the said agreement, the agreement has automatically terminated.”
Paytm, along with Vijay Shekhar Sharma, in July 2020 had announced that they would acquire Raheja QBE general insurance, a Mumbai-based company.
Prism Johnson holds 51% stake in the insurance company and remaining 49% is held by QBE Australia. Prism Johnson had approved divestment of 51% in Raheja QBE for an aggregate consideration of Rs 289.68 crore.
However, the deal couldn’t be approved by the insurance regulator IRDAI due to many reasons including stakes of Chinese tech behemoths Ant Financial and Alibaba in Paytm.
Both Chinese investors have sold an aggregate of 6 per cent stake in Paytm. Ant Financial diluted its stake from 28 per cent to 23 per cent whereas Alibaba’s stake post IPO was down from 7 per cent to 6 per cent in Paytm.
The regulator had also asked Paytm to put in much larger capital of around Rs 1000 crore in Raheja QBE General Insurance which the company had taken time to comply.
Paytm had pioneered QR code and wallet trends in the country. It has also successfully forayed into financial services as its partner-based lending business has recorded rapid growth.
This, along with the growing technology-led insurance penetration in India, now gives the company confidence to
In a separate filing on Sunday, Paytm shared its business operating update for the month of April. Paytm’s lending business now has an annualized run rate of Rs 20,000 crore.
In April alone, the company disbursed 2.6 million loans through its platform worth Rs 1,657 crore ($221 million). The company also recorded over 100% year-on-year growth in total merchant payments volume or GMV, aggregating to Rs 0.95 lakh crore ($12.7 billion).
Paytm’s monthly transacting users stood at 73.5 million. In the offline payments segment, the company’s total device deployment across India has crossed 3 million.