New Delhi: Walmart’s stake in PhonePe, the digital payments giant, has reportedly decreased to approximately 85% by the end of April. This marks a decline from the previous ownership of 89% three months prior. PhonePe initiated a fundraising plan to raise funds amounting to USD 1 billion, during which it sold new shares.
Walmart, the parent company of PhonePe, disclosed in its quarterly report to the US Securities and Exchange Commission that it raised USD 0.5 billion in fresh equity fundraising for its majority-owned subsidiary PhonePe during the three months ending on April 30, 2023. As a result, Walmart’s stake in PhonePe was reduced to around 85%.
PhonePe has successfully raised a total of USD 850 million through five transactions since January. This includes investments from private equity firms such as General Atlantic, Ribbit Capital, and Tiger Global. In March, Walmart itself contributed USD 200 million to PhonePe’s ongoing investment. The fundraising round is being conducted at a pre-money valuation of USD 12 billion, making PhonePe the most valuable privately held fintech company in the country. Walmart initially acquired PhonePe as part of its acquisition of Flipkart, an ecommerce startup, in 2018.
Following its separation from Flipkart in December of the previous year, PhonePe launched an investment round. The first investment in January came from General Atlantic, amounting to USD 350 million. This was followed by a joint investment of USD 100 million from fintech investor Ribbit Capital, TVS Capital Funds, and Tiger Global. After Walmart’s infusion of capital, General Atlantic committed an additional USD 200 million over April and May.
In addition to the aforementioned investments, media reports suggest that Binny Bansal, Co-founder of Flipkart, was in discussions to invest USD 100-150 million in PhonePe.
Since its separation from Flipkart, PhonePe has been focusing on expanding its offerings beyond the unified payments interface (UPI), in which it holds a leading market position. Earlier this year, PhonePe made attempts to acquire the buy-now, pay-later startup ZestMoney. However, the deal did not materialize due to concerns raised during the due diligence process.