New Delhi: China's Alibaba Group Holding and its unit Alipay are in advanced talks to buy a stake for about $550 million (Rs 3,150 crore) in India's One97 Communications, which owns Paytm, an e-commerce payment platform which consumers can access through mobile apps, reports suggest.
With this Paytm may become one of the fastest Indian startups to get past the billion-dollar valuation mark. One97 Communications has been in talks with various suitors to raise fresh money especially to boost its flagship m-com and virtual wallet property, Paytm.
The deal, which is expected to be announced by the end of January, will be a strategic move by Alibaba to strengthen its presence in a fast growing e-commerce market like India.
Alibaba, which draws its strength from its B2B as well as B2C e-com properties in China, has presence in China, India, US, Japan, Malaysia, Thailand, South Korea, Turkey, Taiwan and Vietnam.
Reports suggest that as per the deal, Alibaba and Alipay will hold between 30 per cent and 40 per cent of One97 after the investment, the sources said.
Other investors of One97 include SAIF Partners, Intel Capital and SAP Ventures, according to its website.
The investment comes around two months after its founder and chief Jack Ma visited India as part of a Chinese business delegation and talked about his plans to invest more in the country.
One97 had filed red herring prospectus in 2010 but deferred its Initial Public Offering (IPO) plan due to erosion of value in the mid-cap market.
One97 had raised $10 million in its third round of funding from SAP Ventures in 2011, the corporate venture capital arm of German software giant SAP. The company's valuation during this round was nearly $300 million.
