The value of China’s Ant Financial, which holds a 9.89 per cent stake in One 97 Communications, has dropped to Rs 2,742 crore as of Monday with the recent fall in the company’s share price. The Chinese financial giant, which had invested in One 97 Communications since 2015, has seen a sharp decline of 45 per cent, or Rs 2,125 crore, in the value of its stake since the Reserve Bank of India took action against Paytm Payment Bank on 31 January.
One 97 shares closed at Rs 422.6 a share on Monday.
The Chinese company, however, had sold its stake worth Rs 8,293 crore in three tranches over the past year, thus saving a major part of its portfolio from the meltdown in One 97 Communications share prices witnessed since early this month. As per public filings, Alibaba and Ant Financial had invested $851 million in Paytm since 2015. The company started selling shares in the stock markets after One 97 Communications was listed in November 2021.
One 97 Communications’ Initial Public Offering (IPO) was launched at Rs 2,150 a share, and Ant Financial exited at an average price of Rs 616 a share in the first quarter of 2023, Rs 755 a share in the second quarter, and Rs 856 a share in the third quarter of 2023, as per statistics collected from Bloomberg.
An email sent to Ant Group did not elicit any response.
Interestingly, in August last year, Vijay Shekhar Sharma acquired a 10.3 per cent stake from Ant for $628 million – making him the biggest shareholder in the company. As per the agreement, Resilient, a VSS entity, will acquire ownership and voting rights of the 10.30 per cent block. In consideration for the acquisition of the 10.30 per cent stake, Resilient issued Optionally Convertible Debentures (OCDs) to Antfin, which in turn allowed Antfin to retain the economic value of the 10.30 per cent stake, demonstrating Antfin’s continued confidence in the business potential. Accordingly, no cash payment was made for the acquisition, and neither will any pledge, guarantee, or other value assurance be provided by Sharma.
Apart from Ant Financial, SAIF III Mauritius (10.85 per cent), SVF India Holdings (Softbank- 6.46 per cent), and founder Vijay Shekhar Sharma 19.4 per cent are the major shareholders of the company.
First Published: Feb 12 2024 | 7:06 PM IST