Paytm files application with SEBI, announces to bring biggest IPO
Paytm will bring the biggest IPO of Rs 16,600 crore. There will be an offer for sale of Rs 8300 crore and a fresh issue of Rs 8300 crore.
New Delhi. Payment company Paytm has filed an application with SEBI for its IPO on Friday. India’s digital payments leader Paytm, backed by China’s Ant Group and Japan’s Soft Bank, is aiming to raise Rs 16,600 crore, or $2.23 billion, through an IPO. This will be the biggest IPO of the country till date. Till now the largest IPO in the country was of Coal India Limited. In 2010, the company had raised more than Rs 15,000 crore through this.
2 thousand issue for private placement
Paytm’s IPO will have an offer for sale (OFS) of Rs 8,300 crore and a fresh issue of Rs 8,300 crore. Apart from this, the company can issue shares worth an additional Rs 2000 crore. An issue of Rs 2000 crore will be considered through private placement.
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Now CEO Vijay Shekhar Sharma will no longer be the promoter of the company
Paytm’s parent company is One97 Communications. Paytm is the country’s next generation internet based company which continues to be attractive to both retail and institutional investors. Prior to this, the shareholders of Paytm have approved the raising of Rs 12,000 crore through the fresh issue of the recently held AGM shares. The shareholders had also approved that Paytm’s founder and CEO Vijay Shekhar Sharma would cease to be the promoter of the company. He does not hold more than 20 per cent stake in the company, which is necessary to be a promoter of a company. Vijay Shekhar Sharma holds 14.61 per cent stake in the company.
But Vijay Shekhar Sharma will continue to be the chairman, managing director and chief executive officer of the company. This change in the company is a part of the already decided plan. For a company to be a professionally managed company, it is necessary that it should get the approval of SEBI. Under this rule, no one company or individual should hold more than 25 percent stake in the company.
Alibaba’s stake in Paytm is 38 percent
Among the key investors in Paytm are China’s Alibaba and Ant Group, which together hold 38 per cent stake. Japan’s Soft Bank holds 18.73 per cent. And Elevation Capital holds 17.65 percent stake.
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