Paytm shareholders approve country's biggest public offer plan of Rs. 16,600 crore

On Monday, as per a source familiar of the EGM (extraordinary general meeting), Paytm, a digital payments and financial services company has obtained approval for the country's biggest public offer of Rs. 16,600 crore (US$ 2.23 billion), from the shareholders.

The shareholders have granted permission to raise Rs. 12,000 crore (US$ 1.61 billion) in the initial public offer. The sale of secondary shares is expected to take the total amount to Rs. 16,600 crore (US$ 2.23 billion).

According to a source knowledgeable of the EGM (extraordinary general meeting) outcome, “At the meeting, shareholders have authorized all the proposals. The proposal has been approved to raise capital and the fresh issue of shares of up to Rs. 12,000 crore (US$ 1.61 billion) in the IPO.”

At the EGM, the shareholders accepted the proposal that Mr. Vijay Shekhar Sharma, Paytm founder would not be recognised as the ''promoter'' of the firm but will remain to be the chairman, managing director and chief executive officer of the corporation.

The source said, “As per SEBI rules, Paytm is a well-managed firm. No shareholder can get ''special rights''. That is exactly how listed corporations need to be in India.”

In the last quarter of 2010, Coal India listed the biggest IPO issue of ~ Rs. 15,500 crore (US$ 2.08 billion).

As per the source, the valuation of Paytm is expected to be around Rs. 1.78 lakh crore (US$ 23.89 billion) – Rs. 2.2 lakh crore (US$ 29.53 billion). With this valuation scale, Paytm is anticipated to be among top 10 listed financial services in India.

Paytm shareholders involve Alibaba's Ant Group (29.71%), Softbank Vision Fund (19.63%), SAIF Partners (18.56%) and Vijay Shekhar Sharma (14.67%). Other shareholders in the firm are Berkshire Hathaway, Discovery Capital, AGH Holding and T Rowe Price.

The company is likely to have developed a team of 9 key managerial persons (KMPs) led by Mr. Sharma, that are supposed to feature in the IPO document.

The KMPs include Mr. Madhur Deora, company's president and group chief financial officer (CFO), CFO Mr. Vikas Garg, lending business head Mr. Bhavesh Gupta, Paytm First Games COO Mr. Sudhanshu Gupta, Paytm Labs CEO Mr. Harinderpal Singh Takhar, Paytm Payments chief technology officer Manmeet Dhody, online payments head Mr. Praveen Sharma, Offline payments head Ms. Renu Satti, and Mr. Deepankar Sanwalka, president for compliances and operations.

It may also involve Paytm Payments Bank MD and CEO, Mr. Satish Gupta, Paytm Money CEO, Mr. Varun Sridhar and Paytm general insurance MD and CEO Mr. Vineet Arora.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.