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Paytm has agreed to sell its stake in Japanese payments company PayPay to SoftBank for $279.2 million, as the Indian company disposes of non-core assets following a harsh regulatory crackdown earlier this year.
The sale of Paytm’s stake in PayPay, which it acquired through buyout rights six years ago, comes after months of restructuring at the Indian company that saw the company sell its entertainment ticketing unit to Zomato for $246 million in August.
PayPay, controlled by SoftBank and Yahoo Japan Z Holdings, is one of the leading payment apps in Japan.
The stake sale will boost Paytm’s cash reserves to $1.46 billion as it attempts to regain share in India’s highly competitive payments market. The company’s banking services were severely restricted by regulators in January, leading to a migration of customers to rival services.
Shares of Paytm have nearly tripled since June after India’s payments regulator allowed it to resume adding customers to its flagship UPI service. The company reported its first quarterly profit in September, although this was largely due to proceeds from asset sales rather than operational improvements.
“We are grateful to Masayoshi San and the PayPay team for giving us the opportunity to work together to revolutionize mobile payments in Japan,” Paytm said in a statement. “We remain fully committed and will continue to support PayPay’s products and technology innovations in the future. We are working to introduce new AI-powered features to accelerate PayPay’s vision in Japan.
Saturday’s deal marks the end of Paytm’s relationship with SoftBank, which offloaded its remaining shares in June after being an early backer through its Vision Fund.
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