Paytm’s IPO official, staff invited to sell their shares – Times of India

MUMBAI: In its first official communication of its plans to list, Paytm has written to employees stating that its parent company One97 Communications has received an in-principle approval from its board to float an initial public offering (IPO). The mail said that the IPO would comprise a fresh issue and/or an offer for sale of shares. It has offered employees an option to sell their holdings in the issue.
In what might be an indication of the time frame, the mail asks employees to transfer the shares that they propose to sell in an escrow account by June 22 this year. The company has said that it may, prior to the issue, undertake a sub-division of its authorised share capital before filing the draft red herring prospectus.
The mail added that the size of the offer for sale component is subject to the final approval of the board. If the size of the issue is not enough to accommodate all the shares offered by employees, the shares will be accepted on a pro-rata basis.
There has been speculation over the size of Paytm’s IPO in the media. Reports have placed the size of the offering at $3 billion, or around Rs 22,000 crore, which would make it the largest so far. One97 Communication has transferred almost its entire payments business to Paytm Payments Bank, which received an RBI licence in 2015. The bank was launched with One97 holding 39%, promoter Vijay Shekhar Sharma holding 51% and 10% held by a One97 subsidiary.
Paytm Payments Bank has since made an application to convert itself into a small finance bank which will enable it to transform into a new age bank. This will enable the bank to substantially increase its earning potential through loans and credit cards.