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One97 Communications Ltd., owner of the e-commerce payment system Paytm, has sent a notice to its employees and shareholders has said that it has proposed “to undertake an initial public offering (IPO) of its equity shares, subject to market conditions, regulatory, corporate and other approvals, and other relevant considerations, in accordance with applicable law, and has received an in-principle approval from the board of directors of the company in this regard”.
The company’s debut could be India’s largest stock market debut ever. Paytm is asking its employees to determine whether they want to sell shares in the digital payments pioneer’s planned IPO.
Paytm’s board has authorized the offering plans in principle. According to a person familiar with the matter, it is finalizing the draft red herring prospectus, which might be filed in the first week of July.
Bloomberg News had reported in May that the company’s investors include Berkshire Hathaway Inc., SoftBank Group Corp. and Ant Group Co., is seeking to raise about $3 billion (₹218 billion) at a valuation of around $25 billion to $30 billion.
To meet India’s regulatory obligations, Paytm’s debut will comprise of a mix of both new and existing shares.
The documents have stated that Paytm’s board has preliminary approved to the debut, but formal approval cannot take place until the prospectus is finalized.
“Equity shares not sold during the offering of would be locked-in for a one-year period,” the notice also said that employees can participate in the IPO by consenting to offer all or part of their equity shares and a decision that would need to be approved before the filing of the first of the offering documents to the country’s regulator.