New Delhi-based online retail payments platform Pine Labs has signed a definitive agreement to acquire Bengaluru-based digital gift card firm Qwikcilver Solutions for $110 Mn, subject to closing conditions.
Pine Labs said that the deal has been funded from the company’s cash reserves and additional funding from existing investors. Post-acquisition, Kumar Sudarsan, cofounder and CEO of Qwikcilver will join the leadership team of Pine Labs.
The companies said the acquisition will bring together the strengths of Pine Labs’ merchant-focused and Qwikcilver’s brand-focused software-as-a-service (SaaS) technology platforms, and augment their Indian and international market reach.
The combined gift solutions business will have a customer base of over 250 brands and retailers, and 1500 enterprise customers.
The reports of acquisition had been rife since February 2019 and it was speculated that once the acquisition deal materialises, the existing investors in the company are expected to cash out, while the founders of the company may stay on with the team.
Founded in 1998 by Lokvir Kapoor, Pine Labs delivers active point-of-sale payments in India through its smart cloud-based payments platform, and claims to be processing about 450 Mn transactions worth over $15 Bn annually, as of March 2018.
Till date, the company has raised $223 Mn from investors like Temasek, PayPal, Sequoia Capital, Madison India Capital among others. Pine Labs started its own gift solutions business – Pine Perks – four years ago. The Pine Perks gift cards are used by 600 organizations across banking, insurance, manufacturing, pharmaceutical, FMCG and telecom industries.
Vicky Bindra, Chief Executive Officer, Pine Labs, said “We see excellent complementary strengths between the Pine Labs’ and Qwikcilver’s gift businesses. While Pine Labs has a strong merchant network, Qwikcilver has market-leading processing and distribution capability. We are confident that both teams’ deep domain experience will accelerate our vision of building a world-class merchant-centric ecosystem.”
Launched in 2008 by Kumar Sudarsan, TP Pratap and Bhaskar Vasudevan, Qwikcilver helps retail and corporate customers to enhance their sales, brand and loyalty through card-based interventions such as Gift Cards, Loyalty Cards, Discount Cards, Frequency Cards, Credit Cards. It also provides a cloud-drive software-as-a-service for various brands.
The company claims to manage an annualised gross transaction value of $1.5 Bn across India, Middle East and SouthEast Asia. It has raised $20 Mn from Sistema Asia Fund, Amazon, Accel Partners and Helion Venture Partners.
Kumar Sudarsan, cofounder and CEO of Qwikcilver said, “With Pine Labs, we have the potential and ability to significantly scale the gift card category and drive consumer adoption with novel products and solutions. We are very excited about taking the next step in our journey with Pine Labs.”
According to a recent report, the Indian gift card market is expected to reach $80 Bn – $85 Bn by 2024. At the same time, e-gift cards are expected to account for a lion’s share with $70 Bn.
Update: April 19| 11:40 AM
Pine Labs confirmed that that company has completed the acquisition of Qwikcilver in a deal worth $110 Mn.