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Home BUSINESS India's largest fintech M&A deal fails: PayU cancels BillDesk purchase

India’s largest fintech M&A deal fails: PayU cancels BillDesk purchase

The largest merger and acquisition (M&A) deal in the Indian fintech space fell through, with Prosus-backed PayU calling off the BillDesk acquisition. The acquisition, for a total consideration of $4.7 billion, was announced on August 31, 2021.

In a statement issued on Monday, Prosus said: “The closing of the transaction was subject to the satisfaction of several preconditions, including approval from the Competition Commission of India (CCI). PayU obtained approval from CCI on September 5, 2022. However, certain conditions precedent were not met by the extended deadline of September 30, 2022, and the agreement has automatically terminated in accordance with its terms and, consequently, the proposed transaction will not be implemented.”

On August 31, 2021, Prosus announced that an agreement had been reached between PayU Payments Private Limited (PayU), a subsidiary of Prosus, and the shareholders of Indian digital payment provider BillDesk.

While the deal got the go-ahead from the ICC only in September, it had yet to receive approval from the Reserve Bank of India (RBI). The process was to take at least 45 days.

Prosus, a long-term investor and operator in India, has invested close to $6 billion in Indian technology companies since 2005. It said it remained committed to the Indian market and growing its existing businesses within the region. Some of his other investments include Meesho, Byju’s, DeHaat, Mensa Brands, and Good Glamm Group.

This acquisition would have made PayU the largest player in the digital payments segment (B2B). At the time of the acquisition announcement, the head of PayU India, Anirban Mukherjee, had said business standard that the synergies of both companies would lead to the launch of more new products in the market.

“We know where some of the synergies are. For example, they are very strong in paying bills in government and financial services. We are much more focused on e-commerce and SMEs. There are synergies where your products apply to our customers and vice versa. Just like LazyPay, you can enter their payment pages. The biggest conversation will happen once we close this deal. I feel like this kind of scale can drive a different level of innovation and market access. We have a lot of complementary strengths and I hope we have a lot of ideas on how to leverage this to drive last-mile digitization much faster in India,” he said.

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