FreeCharge Finds A New Home: Sold To Axis Bank For $60 Mn

The acquisition deal between Axis Bank and Jasper Infotech-owned digital wallet FreeCharge is done. The Axis Bank Board of Directors have agreed to acquire the digital wallet for $60 Mn.

The deal is subject to regulatory approval by RBI. The acquisition is expected to be completed within two months.

In the company filings with the BSE, Axis Bank said the “Board of Directors of the Bank accorded on Wednesday, 26th July 2017, the Bank has today entered into a Share Purchase Agreement (”SPA”) with Jasper Infotech Private Limited (”Snapdeal”), to acquire 100% equity capital of Accelyst Solutions Private Limited (”Accelyst”) & Freecharge Payment Technologies Private Limited (”FPTPL”) (Accelyst and FPTPL collectively referred to as ”Freecharge”), subject to receipt of requisite regulatory approvals, including from the RBI, for a cash consideration of $60 Mn (INR 385 Cr).”

FreeCharge currently claims to have a user base of about 50 Mn customers which will now be accessible to Axis Bank. Apart from this, the 200-member-team of FreeCharge will join Axis Bank, which will run FreeCharge as a separate entity.

As per the statement, Accelyst had total assets worth $16.65 Mn (INR 106.8 Cr) and a total income of about $6.58 Mn (INR 42.2 Cr). On the other hand, FreeCharge had total assets worth $26.35 Mn (INR 169 Cr) and a total income of about $3.9 Mn (INR 25 Cr).

Jasper’s subsidiary Accelyst Solutions Pvt. Ltd owns and operates FreeCharge that provides online recharge and bill payment services. The company offers online recharge for prepaid mobile, data cards, and DTH connections; as well as postpaid mobile bill payment services. It also provides rewards by way of discount coupons from various brands in food, lifestyle, ecommerce, travel, and other sectors for transactions made through the website.

The acquisition was also confirmed by the digital wallet’s co-founder Kunal Shah on his Facebook page. He said, “The choice we made (merger with Snapdeal) didn’t work out as planned for several reasons but super proud of what we achieved as a team and product. We grew 3x on almost all metrics, post exit with low capital at hand. Happy about the news and wish FreeCharge a great success with Axis Bank.”

In his statement, Shah, however, did not disclose the financial details of the transaction.

It was reported last night that Jasper Infotech Board had agreed to sell the digital wallet business to Axis Bank for $60 Mn, a mere 15% of FreeCharge’s $400 Mn sale to Snapdeal in 2015.

Axis Bank was conducting due diligence on the e-wallet platform for the past two weeks. With this acquisition, Axis Bank looks to strengthen its presence in the country’s burgeoning digital payments space.

Founded in 2010 by Sandeep Tandon and Kunal Shah, FreeCharge, once valued at $5 Bn, was acquired by Snapdeal as part of a $400 Mn-$500 Mndeal. In May 2017, parent company Jasper Infotech infused $3.38 Mn (INR 22 Cr) in FreeCharge. Prior to this, in March, Snapdeal made an investment of $20 Mn in the online payment platform.

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