PhonePe files updated IPO papers, Microsoft, Tiger Global to exit
In a significant development, digital payments firm PhonePe has filed its updated draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise funds through an initial public offering (IPO). The issue will be entirely an offer for sale of 5.06 crore equity shares by existing shareholders, as per the updated DRHP.
The development is a crucial step towards PhonePe’s plans to go public, and the updated filing provides more clarity on the shareholding pattern of the company post-IPO. The offer for sale will see existing shareholders, including Walmart, Microsoft, and Tiger Global, dilute their stakes in the company.
Walmart, the parent company of Flipkart, which owns a majority stake in PhonePe, will reduce its stake in the payments firm by around 9%. This move is seen as a strategic decision to unlock value for its shareholders while also providing an opportunity for new investors to participate in PhonePe’s growth story.
On the other hand, smaller shareholders Microsoft and Tiger Global will fully exit their stakes in PhonePe through the IPO. The exit of these investors is not surprising, given their investment horizon and the fact that PhonePe has already achieved significant scale and traction in the Indian digital payments market.
The updated DRHP filing provides a detailed overview of PhonePe’s financial performance, business operations, and future growth plans. The company has reported significant growth in its revenue and user base over the past few years, driven by the increasing adoption of digital payments in India.
PhonePe’s IPO plans have been in the works for several months, and the company had initially filed its DRHP with SEBI in July last year. However, the company had to refile its papers due to changes in its shareholding pattern and other regulatory requirements.
The IPO market in India has been witnessing a resurgence in recent months, with several companies lining up to raise funds through public issues. PhonePe’s IPO is expected to be one of the most highly anticipated issues in the coming months, given the company’s strong brand presence and growth prospects.
The digital payments space in India has seen significant growth in recent years, driven by government initiatives such as demonetization and the push for digitalization. PhonePe has been a key beneficiary of this trend, with its user base and transaction volumes growing rapidly over the past few years.
The company’s decision to go public is seen as a strategic move to raise funds for further expansion and growth. PhonePe has been investing heavily in new technologies and services, including digital banking, credit, and insurance products. The company plans to use the proceeds from the IPO to further strengthen its market position and expand its offerings.
In conclusion, PhonePe’s updated DRHP filing is a significant development in the company’s plans to go public. The offer for sale will provide an opportunity for existing shareholders to exit or reduce their stakes, while also allowing new investors to participate in the company’s growth story. With its strong brand presence and growth prospects, PhonePe’s IPO is expected to be one of the most highly anticipated issues in the coming months.
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