Paytm And Bharti Group's Talks On Stake Acquisition Fail: Report

Sunil Mittal, founder of Bharti Enterprises, was seeking to fold Airtel Payments Bank into Paytm Payments Bank in a stocks deal and also seeking to acquire Paytm shares from other holders

Paytm management declined to give up management control as they didn’t see a strategic alliance in the payments business because of differences in business model.

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Telco giant Bharti Group had reportedly shown interest in acquiring a stake in Paytm, the country's leading digital payments platform, according to news report. This was first reported by news agency Bloomberg last week. However, the talks between the two firms have collapsed, and no deal is currently in the works, as reported by some news reports.

Sunil Mittal, founder of Bharti Enterprises, was seeking to fold Airtel Payments Bank into Paytm Payments Bank in a stocks deal and also seeking to acquire Paytm shares from other holders.

Paytm management declined to give up management control. The fintech giant didn’t see a strategic alliance in the payments business because of differences in business model. "While we don't typically comment on market speculation, we can confirm that we remain fully focused on our strong organic growth journey and are not involved in any such discussions," a representative for Paytm said.

Citing sources, Bloomberg reported that Ant Group Co. is considering selling a portion of its holdings in Paytm's parent firm in order to maintain its holdings below a necessary threshold. This is after One 97 Communications Ltd.'s share percentage increased passively due to share buybacks. The Chinese fintech behemoth has been discussing alternatives to lower its investment in the company, the report said.

The company’s backers include Japan’s SoftBank Group Corp. and China’s Ant Group.

Paytm, once India’s most valuable start-up, has never traded above its IPO price of Rs 2,150 since its listing in November 2021.

Mittal’s six-year-old payments bank had 129 million customers and had turned profitable in the year to March 31, 2022, exchange filings show.

Paytm is growing its product offering to attract more customers, seeking to convince investors of its earnings potential. Eight brokerages have either a buy or overweight recommendation on One 97 Communications, with a consensus 12-month price target of 944.64 rupees, according to data compiled by Bloomberg.