Sunday, December 8, 2019
Home > BUSINESS > Warren Buffet: Berkshire Hathaway invests Rs 2500 crore in Paytm

Warren Buffet: Berkshire Hathaway invests Rs 2500 crore in Paytm

Spread the love
 

Berkshire Hathaway Inc is looking to invest Rs 2,500 crore ($356 million) in the Indian company behind digital payments firm Paytm, according to a source with direct knowledge of the deal, in a foray by the conglomerate into India and the financial payments industry.

Billionaire Chairman Warren Buffett’s assistant, Debbie Bosanek, confirmed Berkshire’s interest in India’s One97 Communications Ltd in an email. She said Buffett was not involved in the transaction The investment, which values the Alibaba and SoftBank-backed One97 Communications at over USD 10 billion, is likely to be announced in the next few weeks, according to two people familiar with the development. They did not wish to be identified as the deal is still in the works.

In May, Buffett said at Berkshire’s annual shareholders meeting that the financial payments industry is a huge deal around the world and that many companies are working to reinvent the industry. His conglomerate, meanwhile, has been under pressure to find significant investments and whittle down a $108.6 billion stockpile of cash.

One97 Communications and SoftBank did not immediately respond to requests seeking comment. A spokeswoman for Alibaba referred Reuters requests to Paytm.

Berkshire’s first investment

The deal, if completed, would be Berkshire Hathaway’s first investment in an Indian technology ecosystem.

It will also add more muscle to Paytm’s operations as it competes against rivals like PhonePe and Google’s Tez. Paytm has also been aggressively diversifying its business into areas like investment management and e-commerce. In May last year, SoftBank had pumped in $1.4 billion (over Rs 9,079 crore) into Paytm.

Paytm has been one of the prominent beneficiaries of the governments move in November 2016 to scrap high denomination notes. It has seen manifold growth in transactions on its platform as well as expansion in number of users.

The company crossed an annual gross transaction run-rate of USD 29 billion in May this year. It attributed the growth to strong adoption of mobile payments and bank transfers on its platform.

  • One97 also owns 49 per cent stake in Paytm Payments Bank. Also, Paytm founder Vijay Shekhar Sharma had started e-commerce business under Paytm Mall that competes with giants like Amazon and Walmart-backed Flipkart.

One thought on “Warren Buffet: Berkshire Hathaway invests Rs 2500 crore in Paytm

Leave a Reply

Your email address will not be published. Required fields are marked *

Translate »