Shareholders of One97 Communications, the parent company of IPO-bound Paytm, have agreed to its proposal of raising INR 16,600 Cr in the initial public offering. The shareholders gave their approval in an extraordinary general meeting that was held on Monday with Paytm’s current employees, ex-employees and investors.
The Noida-based online payment firm is all set to bag INR 12,000 Cr through freshly issued shares and INR 4,600 Cr through secondary element where investors will sell their stake directly. Paytm is trying to reach a valuation between $24 Bn and $30 Bn.
During the meeting, shareholders agreed that Paytm founder Vijay Shekhar Sharma should not be called as ‘promoter’ to comply with SEBI’s rules requiring promoters of listed firms to have at least 20 percent of post-issue capital. Sharma will continue to be chairman, managing director and CEO of Paytm. This move is in line with making Paytm a professionally managed company.
Paytm might also have to consider lowering the stake enjoyed by its two major Chinese investors – Alibaba and Ant Group – as they enjoy a whopping 37 percent stake, way more than the 25 percent mark required to become a professionally managed company. Lately, it has been noted that One97 Communications board has gone through a reshuffle mostly replacing Chinese nationals with Indian or US nationals. For instance, Douglas Lehman Feagin, senior vice president, at Ant Group was brought to its board while replacing Ant Group chairman and chief executive officer, Jing Xiandong.
One97 Communications is likely to file a Draft Herring Prospectus (DHRP) with SEBI this week and is expected to go public by the end of November.
During the meeting, shareholders also agreed to the changes in the Employee Stock Options Plan (ESOP) and finalised changes in articles of association. Last week, Business Standard reported that Paytm saw high-level exits including Amit Nayyar who was the president of Paytm. Others who left the firm before the IPO are Rohit Thakur, chief human resource officer, Amit Veer, chief business officer, and senior vice president of user growth, among others.
The year 2021 is anticipated to become a watershed moment for Indian tech startups as the year is expected to see the highest number of tech startups going public. Food delivery platform Zomato became this year’s first startup that will go public on Wednesday (June 14) and is seeking to raise INR 9,375 Cr in the public issue. Gurugram-based payment firm MobiKwik is also said to be planning to file its DRHP with the capital market regulator within a week.
The post Paytm’s Shareholders Approve INR 16,600 Cr IPO appeared first on Inc42 Media.
0 Comments