SoftBank Sets Time Frame for One97's IPO

SoftBank Sets Time Frame for One97's IPO

A Japanese multinational conglomerate company, Softbank as a part of its latest financing round in digital payments player One97 Communications, has laid down new clause and conditions. The SoftBank Vision Fund (SVF), an existing investor in Paytm, has insisted that the One97 Communications should go public, within five years from the time of completion of the transaction, According to ET sources.

SoftBank has invested in One97 Communications in 2017, and thus, possesses about 19 percent stake, whereas the Alibaba Group, via Ant Financial and directly holds nearly 38 percent in the company. From the beginning of this year, Paytm has been in talks to raise funds, in spite of its losses and growing competition in the digital payment sector.

The ET sources even state that the company's spokesperson was unavailable for comments, and also denied the condition to list within five years. Furthermore, these developments are the results of stricter terms and conditions of SoftBank along with the after-effects of WeWork downfall, which led to a $4.6 billion loss for the Japanese telecoms and internet sector. 

One97 Communications has posted that it underwent 3,959.6 crore net loss in the financial year 2019 as compared to 1,490 crore a year ago. According to the information shared by the company, its standalone profit margin rose slightly to 3,319 crore from 3,229 crore in the financial year 2018.    

The $1 billion funding round might probably witness US asset manager T Rowe Price invest around $150-200 million in One97, along with existing backers, SoftBank and Alibaba Group affiliate Ant Financial infusing the rest, as reported in ET October 15 edition.