SoftBank Exits Paytm After $279.2 Million Stake Sale in PayPay

SoftBank Group has officially ended its association with Indian fintech giant Paytm by divesting its Singapore subsidiary's stake in Japan-based PayPay Corporation to a SoftBank Vision Fund 2 entity. 

The $279.2 million transaction cuts both direct and indirect investment ties between SoftBank and Paytm.  

In Q1 2024, SoftBank sold its direct Paytm stake, recording a $544 million loss. However, it had forecasted a smaller net loss of $100-150 million, expecting proceeds of $390-450 million from Paytm’s PayPay stake sale.
 
The actual sale price of $279.2 million resulted in a higher-than-expected final net loss of $264.8 million.  

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Paytm confirmed the deal on Saturday, revealing that its subsidiary, One97 Communications Singapore Private Limited, sold 3.95% of PayPay Corporation. These Stock Acquisition Rights (SARs), originally acquired in 2020, were sold at a valuation of JPY 1.06 trillion.  

Before Paytm's 2021 IPO, SoftBank held an 18.5% stake, reducing it significantly during the IPO and later through share sales. SoftBank purchased Paytm shares at an average price of Rs 800 per share but faced challenges as Paytm’s stock value struggled post-listing. 

After hitting a record low of Rs 310 in May following RBI sanctions on Paytm Payments Bank Ltd (PPBL), the stock has since recovered, last trading at Rs 975.35.  

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This sale concludes SoftBank's planned exit from Paytm within the 24-month timeline it announced after the IPO’s regulatory lock-in period.

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