India’s largest acquisition in the fintech space between the Prosus-backed PayU India and payment gateway provider BillDesk has received a sign-off from the country’s competition watchdog. The Competition Commission of India (CCI) tweeted on Monday evening that it had approved the acquisition of all shares of BillDesk by PayU payments.
This gives a closure to the acquisition announcement made in August last year whereby PayU, the payments and fintech arm of Prosus that operates in 20 markets, acquired the shares from IndiaIdeas.com, company that owns and operates BillDesk. Following the CCI’s sign off, PayU now becomes a leading provider of payment gateways globally in terms of sheer volumes.
What’s the big deal about?
The shares of PayU India are indirectly held by Prosus NV, a global consumer internet group listed on Euronext Amsterdam. It is considered to be a leading player in the fintech investment space across the world. As for BillDesk, it provides payment aggregation services to enable merchants to receive payments from customers across multiple digital payment options.
Readers would recall that BillDesk was founded in 2000 with investments from Clearstone, Temasek and Visa. From Prosus’ perspective, this acquisition further enhances its presence in India where it operates in several online verticals including food delivery, classifieds and edtech in addition to their core fintech business.
The CCI scrutiny came up last year following the announcement with the antitrust body sending off a 30-page notice calling the two company’s attention to the anti-competition scenario that the acquisition could attract. It also sought answers from PayU on why a detailed investigation should not be called into the deal.
The antitrust body had held hearings around the issue last week and appears to have been satisfied with their responses, thus paving the way for its formal approval last evening to the deal between PayU and BillDesk.
Strong performance by PayU in FY 2022
PayU India revenues grew 48% to $304 million during fiscal year 2022 as total payment volumes grew during the period. The growth was also driven by diversification of their merchant portfolio into segments like financial services, bill payments and online commerce.
The company operates three businesses in India that include payments for domestic and cross-border transactions, credit solutions for consumers and small businesses and strategic investments in fintech companies. PayU also operates the credit-linked Visa card offering LazyCard that was launched last December, with total loan disbursals of $586 million till March.
