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Prosus Acquires BillDesk for $ 4.7 Billion

CIO Insider Team | Tuesday, 31 August, 2021
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Prosus NV, a technology investor, announced that it has paid $ 4.7 billion for 100 percent of the shares in the Indian payments platform Billdesk. BillDesk will be merged with PayU, Prosus' current worldwide fintech and payments firm with a substantial presence in India. Since around July, the deal has been rumored to be in the works.

PayU will become one of the largest online payment providers in the world, with an annual payment volume of $147 billion. The acquisition, however, is not simply a big consolidation move in the payments industry, it also highlights Prosus' continued focus on new countries, particularly India.

By total payment volume (TPV), the combined entity of PayU and BillDesk will emerge as the world's and India's top online payment providers following the acquisition.

BillDesk is one of the few profitable Internet companies in India, having been founded in 2000 by three former Arthur Andersen executives, M N Srinivasu, Ajay Kaushal, and Karthik Ganapathy. The Mumbai-based firm has long been one of the country's largest online payment processors. It competes with PayU, CCAvenue, and a slew of younger businesses like RazorPay, which are all supported by Naspers.

Prosus believes that the purchase, which is one of the company's largest-ever and one of the largest M&A deals in India, will give its fintech assets in the country a total investment value of $10 billion. This is part of Prosus', as well as Naspers' long-term plan, which includes a number of other purchases and investments in regional companies dating back over a decade.

PayU announced that its domestic and cross-border payments business in India, Latin America, and EMEA was up 51 percent year over year as of March 2021, demonstrating the overall surge in the global digital payments sector in the aftermath of the Covid-19 outbreak.

With a digitally sophisticated consumer base and a fast-rising middle class with disposable means, India represents a significant opportunity for financial services.

PayU has established itself as a major participant in this space. It has competed fiercely in the Indian online merchant acquisition sector, both in terms of price and in-field sales activity. PayU India dominates the payments gateway market, where it formerly fought with BillDesk and CCAvenue.

BillDesk is one of the companies that has requested a license to operate NUE, a new retail payment network proposed for India that will compete with the existing UPI infrastructure. For the license, BillDesk partnered with Amazon, ICICI Bank, Axis Bank, Pine Labs, and Visa.

Prosus is also an active investor, with investments in companies such as remittance business Remitly and others, providing a pipeline for strategic alliances as well as prospective acquisitions in the future.

PayU announced that its domestic and cross-border payments business in India, Latin America, and EMEA was up 51 percent year over year as of March 2021, demonstrating the overall surge in the global digital payments sector in the aftermath of the Covid-19 outbreak.

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