UBS Poised for Indian Fintech Deal
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Swiss bank UBS is reportedly poised to pour several hundred million into a payments start-up in India. The investment is alongside some of the Swiss wealth manager’s ultra-rich clients.
Zurich-based UBS is negotiating a $400 million investment in Paytm, an Indian e-commerce payment system Bloomberg reported on Thursday, citing people close to the talks. The bank’s asset management arm wants to co-invest with UBS’ wealthy clients, the outlet reported – which would mark one of the largest such deals.
The ten-year-old fintech was valued at $16 billion in its last round of financing two years ago. It competes with services like Google Pay or WhatsApp’s payment service, as well as regional start-ups.
UBS is attempting to buy shares from Paytm employees, the news service reported. It doesn’t appear to be a done deal yet: UBS aims to finalize an agreement as soon as this month, though talks could still be delayed or fall apart.
Paytm counts Softbank, Ant Financial, Berkshire Hathaway, and asset manager T. Rowe Price, among its investors. Its CEO, Vijay Shekhar Sharma, said this week Paytm could turn a profit as soon as this year.
Questions & Answers
Q.What is the reported value of the investment UBS is negotiating for the Indian fintech start-up?
What is the reported value of the investment UBS is negotiating for the Indian fintech start-up?
UBS is reportedly negotiating a $400 million investment in Paytm. This sum is described as several hundred million and, if it goes ahead, would mark one of the largest such deals for the bank's asset management arm.
Q.Why is UBS involving its wealthy clients in this potential investment opportunity?
Why is UBS involving its wealthy clients in this potential investment opportunity?
UBS's asset management arm intends to co-invest alongside its ultra-rich clients. This approach could make the deal one of the largest of its kind, indicating a strategy to use client capital in significant investments.
Q.What was Paytm's valuation in its previous financing round, and when did this occur?
What was Paytm's valuation in its previous financing round, and when did this occur?
Paytm was valued at $16 billion in its most recent financing round. This valuation was established two years ago, before the current reported negotiations with UBS regarding a new investment.
Q.Who are some of the existing major investors in Paytm?
Who are some of the existing major investors in Paytm?
Paytm currently counts several prominent investors among its backers. These include Softbank, Ant Financial, Berkshire Hathaway, and the asset manager T. Rowe Price, indicating strong prior investment interest.
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