Cholamandalam Investment to acquire 72% stake in Payswiff for Rs 450 crore

Cholamandalam Investment and Finance Company has announced its plans to acquire a 72.12 per cent stake in fintech payment solutions provider Payswiff Technologies Private Ltd for Rs 450 crore. The company, an NBFC, is part of the Murugappa Group.

The company in a regulatory filing said, "The company is proposing to make a strategic investment in the equity shares of Payswiff Technologies Private Limited (Payswiff) up to a sum not exceeding Rs 450 crores in one or more tranches."

The cash deal may take place at Rs 1,622.66 per share.

The company has signed a Shareholders Agreement and a Share Purchase Agreement on January 17, 2022, with Payswiff, its founders and other existing shareholders. The total investment will result in the Company holding up to 72.12 per cent of the equity capital of Payswiff on a fully diluted basis and Payswiff consequently will become a subsidiary of the Company.

The acquisition will be completed in 30 days from the execution date or such other extended date that may be mutually agreed by the parties.

Payswiff was incorporated under the Companies Act 1956 on August 27, 2013, is engaged in the business of enabling online payment gateway services for e-commerce businesses and provides e-commerce solutions.

Payswiff is an omnichannel payment transaction solution that lets business owners accept payments from their customers in-store, at-home deliveries, online, and on-the-go using mPOS and POS solutions.

The proposed acquisition is in line with the long-term strategy of the Company to explore and expand in the entire lending ecosystem model particularly in the SME segment. Payswiff being a Company forming part of the digital and technology ecosystem in the SME segment is expected to add value to the existing Chola ecosystem.

This investment will provide a platform to build new-age SME offerings at scale, access to the SME network across the country and an opportunity to be one of the preferred SME financiers.