FreeCharge , Mobikwik in Talks Regarding Merger
After grabbing the space in the online market, it seems the turn of mobile wallets. FreeCharge plans to merge with mobikwik.
According to sources after the merger, the new entity is likely to get a top-up of $200 million. also some bank have indicated they would be interested to invest in a merged entity.
However, it is noted that talks are only at an initial stage. Interestingly Sequoia Capital is a major investor in merged wallet entities.
Mobikwik is trying to raise funds it has been on a major expansion mode and opened 13 new offices, recruiting more than 1000 employees. The company has been trying to show investors that it is a good entity in the financial tech space. Co-founder Upasana Taku and founder –CEO Bipin Preet Singh have had meetings with no. of investors in the US and in other countries to raise new ways of funding.
FreeCharge, part of online market place Snapdeal has been on the block for some time. According to sources, Jason Kothari recently appointed as chief executive officer of freecharge , has also been in talks with investors in the US and China to sell it. Paypal was alos initially interested in putting sizeable investment in Freecharge but the deal could not be closed.
The talks started last week as people from Mobikwik and freecharge met to discuss a merger. This would make them one of the largest in the market and especially against their big rivalry Paytm.
Earlier, there was also talk of selling FreeCharhege to paytm . However, nothing much happened on that. According to source, both mobikwik and freecharge would be worth around $300 million in each. And, a merged entity could be valued at anything between $700 mn to $1 billion. Mobikwik recently said it planned to invest Rs. 300 crore in office expansion marketing and technology. It trying to grow its user bases from the current 50mn to 150 mn , in a year. This increase would help its annual gross merchandise value.
At present, the Vijay Shekhar Sharma –run paytm the biggest mobile wallet in the market, with over 200mn users and a host of services.
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