More main consolidation underway on the planet of funds: Prosus — the Dutch tech big that bundles collectively Naspers’ fintech, e-commerce and different worldwide investments and companies exterior of South Africa (together with a giant stake in Tencent) — as we speak introduced that it could pay $4.7 billion to amass BillDesk, a funds supplier based mostly in India. Prosus plans to mix BillDesk with PayU, its present world fintech and funds enterprise, which already has a robust presence in India. The deal has been rumored to be within the works since about July.
The proposed acquisition will make PayU one of many larger on-line fee suppliers globally with some $147 billion in fee quantity yearly. But the proposed all-cash deal is just not solely a major consolidation transfer on the planet of funds: it additionally underscores Prosus’ persevering with deal with growing markets and particularly India. Prosus stated that the deal — one of many greatest ever made by Prosus, and one of many greatest M&A strikes in India — will give its fintech holdings in India a cumulative funding worth of $10 billion.
That is a part of a long-term technique for Prosus (and Naspers) that stretches again practically a decade involving various different acquisitions and investments in startups — together with DotPe and Indiagold — within the area.
The proposed acquisition would require approval from the Indian regulator Competition Commission of India. In a name with reporters Tuesday, Prosus and PayU executives stated they don’t anticipate a lot hurdle in receiving the approval as PayU and BillDesk supply complimentary companies. BillDesk’s community is utilized by India’s largest banks and by a lot of retailers throughout utilities, telecom, insurance coverage, mutual funds, journey and e-commerce verticals.
“Payments and fintech is a core segment for Prosus and India remains our number one investment destination,” stated Bob van Dijk, group CEO of Prosus, in a press release. PayU — fashioned out a mixture of varied pursuits in fintech and funds that Naspers (after which Prosus) had acquired over a number of years, is at present lively in some 20 markets.
India represents an enormous marketplace for monetary providers, with a digitally-savvy client base with a quickly increasing center class with disposable revenue.
Within that, PayU has positioned itself as a robust participant. Specifically, it has been extremely aggressive within the Indian on-line service provider buying market – each on worth and in-field gross sales effort. PayU India has a dominant share within the funds gateway enterprise the place it historically competed with BillDesk and CCAvenue (owned partially by Infibeam) — and of currently, Sequoia Capital India-backed RazorPay.
BillDesk has been round since 2000 and its buyers had included Visa, General Atlantic, and the State Bank of India. PitchBook estimated that its valuation was round $1.53 billion in 2019 when it final raised cash. Tracxn estimated that the founders nonetheless owned just below 30% of the corporate forward of this acquisition.
BillDesk, already a giant contractor for a number of authorities departments, is among the many corporations that has utilized for the license of NUE, a brand new retail funds networks proposed for India that’s anticipated to compete with established UPI railroads. BillDesk has teamed with Amazon, ICICI Bank, Axis Bank, Pine Labs, and Visa for the license.
Anirban Mukherjee, CEO of PayU India, prompt on a name as we speak that Prosus might discover increasing BillDesk’s enterprise exterior of the world’s second most populous nation — although a concrete choice hasn’t been made but, he cautioned.
“We believe this transaction will stimulate both innovation and competition within India’s digital payments industry,” stated Laurent Le Moal, CEO of PayU, in a press release. “This won’t solely assist to strengthen India’s digital financial system, but additionally convey monetary providers to those that might have traditionally been excluded. This ambition is absolutely aligned with the Government of India’s…
