Prosus backed PayU acquires BillDesk for $4.7 billion in biggest payments space buyout in India

In one of the biggest deals in India's payments space, Prosus Ventures (earlier Naspers) will acquire domestic payment gateway company BillDesk for $ 4.7 billion.

The acquisition, the largest merger in the industry, would bolster Prosus's fintech business under PayU.

Post the acquisition, the joint entity of PayU and BillDesk will emerge as the leading providers of online payments globally and in India by Total Payment Volume (POS), according to the company statement.

Founded in 2000 by three former Arthur Andersen executives, MN Srinivasu, Ajay Kaushal, and Karthik Ganapathi -  BillDesk is one of the rare profitable internet companies in India.

The deal

The Mumbai-based company was among the largest online payments processing companies in the country. Other players in the segment are PayU, CCAvenue, and startups like RazorPay.

“We have a long and deep relationship with India, having supported some of the most dynamic entrepreneurs and new technology companies and our company with them since 2005. We have invested close to $ 6 billion in Indian tech to date, and this deal will see that increase to more than $10 billion, "said Bob Van Dyck, CEO of Prosus Group. 

Srinivasu of BillDesk said that the Prosus investment validates the great opportunity in India for innovation-driven digital payments and the progressive regulatory framework established by the Reserve Bank of India.

The behemoth

Together, the two expect to create a financial ecosystem that handles 4 billion transactions a year, four times the current level of PayU in India. "

Prosos said that BillDesk, one of the largest payment platforms in India, generated a net profit of Rs 271 crore for the year ended March 31, 2021. The deal to buy Billdesk, which was established in 2000, is subject to regulatory approvals, including by the Competition Commission of India.

Prosus plans

Prosus, spun out of Naspers of South Africa in 2019, owns two stakes in consumer internet companies in online marketplaces, educational software, food delivery, and fintech. It operates some of the companies. It is best known for its 28.9% stake in Tencent of China.

In India, it is a major investor in Swiggy, one of two food delivery platforms battling for dominance. India has been a major focus for Amsterdam-based Prosus.

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