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Alibaba backed Paytm to boost travel marketplace business, eyes Yatra.com
The Alibaba backed Paytm, which plans to boost its travel marketplace business, may buy a part of the online travel agency Yatra, multiple sources told TOI. Paytm has held a couple of rounds of talks with Yatra and details are being worked out.
Bengalure: The Alibaba backed Paytm, which plans to boost its travel marketplace business, may buy a part of the online travel agency Yatra, multiple sources told TOI. Paytm has held a couple of rounds of talks with Yatra and details are being worked out.
Paytm, which started as an online payments platform, ventured into the travel marketplace last year to boost transaction rates in its core business payments.
"Paytm's investment might come via primary infusion. However, some secondary sale may also happen," a source directly aware of the move said. One of the investors in Yatra confirmed that talks have started for a potential investment from the Noida-based Paytm. An emailed query to Yatra remained unanswered, while Paytm founder Vijay Shekhar Sharma also declined to comment.
The development comes after MakeMyTrip raised about Rs 1,200 crore from China's Ctrip in January . Over the years, MakeMyTrip and Yatra have become arch-rivals even as other players in the space like Cleartrip, GoIbibo and Expedia tap into the online travel market. Recently, Snapdeal integrated redBus and Cleartrip inventory in its mobile application enabling consumers to book bus tickets, flights and hotel rooms. During the initial days of the e-commerce boom, online travel agencies were seen to be the front-runners in the segment. However, over the past couple of years, e-commerce players like Flipkart and Snapdeal have cornered investor interest with billions of dollars being pumped into these companies.
In 2014, Yatra had raised about $23 million from a series of investors at a valuation of $400 million, according to media reports. Norwest Venture Partners, Intel Capital, Vertex Ventures Holdings, IDG Ventures India and Anil Ambaniled Reliance Group are among the leading Yatra investors. Yatra has raised around $125 million since its inception in 2006 via multiple rounds.
"For Paytm, the major attraction is to enhance its network in travel business as older players have been cornering the market share in this space along with funding. Yatra has been looking for fresh funds which could now come via Paytm," another source aware of the development told TOI. Paytm already has an arrangement with Yatra for using its wallet services for various discounts and cashbacks to woo consumers.
According to the latest data from the registrar of companies, Yatra posted revenue of Rs 263 crore in FY15 as against Rs 190 crore a year ago. Its losses have gone up to Rs 67 crore from Rs 40 crore in FY14.
source: techgig.com
