Paytm Sells PayPay Stake to SoftBank
Paytm has sold its stake in Japanese payments firm PayPay to SoftBank for $279.2 million. This move is part of Paytm's strategy to divest non-core assets after facing regulatory challenges earlier this year. The sale follows Paytm's recent divestment of its entertainment ticketing unit to Zomato.
PayPay, a leading payments app in Japan, is controlled by SoftBank and Yahoo Japan parent Z Holdings. This deal boosts Paytm's cash reserves to $1.46 billion, strengthening its position in India's competitive payments market. The company's banking affiliate faced regulatory restrictions in January, impacting its market share. For context on other companies facing regulatory scrutiny, see Meta Questions Musk's Political Role.
Paytm's shares have rebounded since June after regaining regulatory approval to add customers to its flagship UPI service. The company reported its first quarterly profit in September, attributed mainly to proceeds from asset sales. Paytm expressed gratitude to SoftBank and the PayPay team and affirmed its commitment to supporting PayPay's future innovations. They also highlighted their focus on developing new AI-powered features, echoing trends discussed in Meta Unveils Llama 3.3: A Powerful and Efficient AI Model.
This transaction concludes Paytm's relationship with SoftBank, an early investor that divested its remaining shares in June. This divestment strategy may be compared to other tech companies adjusting their portfolios, such as those mentioned in Startups Weekly: Funding, AI, and Climate Tech.