Finally, FreeCharge is home. Axis bank has received approval from the RBI and has completed the acquisition of the digital payments platform, which was announced in July this year. The country’s third largest private sector lender bought Freecharge for $60 Mn in an all-cash deal.
Additionally, the bank has also appointed Sangram Singh as the CEO of FreeCharge Payment Technologies Private Ltd.
In a regulatory filing to stock exchanges, the bank stated, “Pursuant to the receipt of approval for the said transaction from Reserve Bank of India, the bank has completed the acquisition of FreeCharge for a cash consideration of $57 Mn (INR 373.27 Cr), on a cash free, debt free basis.”
Related Article: FreeCharge Finds A New Home: Sold To Axis Bank For $60 Mn
Founded in 2010 by Sandeep Tandon and Kunal Shah, the digital payments platform once valued at $5 Bn, was acquired by Snapdeal as part of a $400 Mn-$500 Mn deal. Axis Bank acquired it at a mere 15% of its $400 Mn sale price to Snapdeal in 2015, hoping to strengthen its presence in the country’s burgeoning digital payments space.
At the time, the bank had stated that the acquisition will double the customer base of the bank. FreeCharge had a user base of about 50 Mn customers at that time with over 200,000 merchants which became accessible to Axis Bank. Secondly, the 200-member-team of the digital payments platform had also joined Axis Bank, thus allowing the bank to leverage Freecharge’s expertise as well as its user base to “to contribute significantly to its aspiration to serve the digital native and mobile first consumers of India.” Even though Axis Bank already had a digital payments app called Axis Pay which is integrated with UPI, the number of users of Axis Pay UPI app is significantly lower compared to FreeCharge. FreeCharge presently has a revenue of about $12.2 Mn (INR 80 Cr).
(The development was reported by ET)