Paytm gets shareholders' nod to raise Rs 12,000 crore, founder Vijay Shekhar Sharma to be declassified as promoter

Sharma will continue to be the chairman, managing director and chief executive officer of the company.

This is in line with Paytm's plan to become a PMC or a professionally managed company , which requires approval from Securities and Exchange Board of India (SEBI). Under this norm, no single entity can own 25 percent or above in the company.

Paytm's key shareholders include Alibaba & Ant Group, which own 38 percent, SoftBank, which owns 18.73 percent and Elevation Capital (previously SAIF partners), which owns 17.65 percent.

Moneycontrol reported earlier that the combined size of the IPO, including both fresh issue and the offer for sale by selling shareholders, is likely to be in the range of $2.2 billion to $2.3 billion, aiming for a valuation between $24 Billion and $25 Billion. If this happens, Paytm's initial share sale would exceed Coal India, which raised Rs 15,000 crore in the country's biggest IPO so far.

Paytm will be filing its Draft Red Herring Prospectus with the SEBI shortly, the first step towards a public listing. It has already finalised seven investment banks, namely Morgan Stanley, Goldman Sachs, ICICI Securities, JP Morgan, Axis Capital, Citi and HDFC.

The stakeholders, on July 12, also approved the changes in the Employee Stock Options Plan (ESOP) besides the adoption of new articles of association. The changes are in accordance with the provisions of the stock exchanges.

Ahead of its initial public offering (IPO) Jing Xiandong of Ant Group has exited One97's board and is being replaced by Douglas Lehman Feagin, as per filings with the registrar of companies (ROC) Moneycontrol accessed. Feagin is the senior vice president of Ant Group and is based out of the US.

The company has also appointed Ash Lilani, managing partner of Saama Capital as an independent director.

Michael Yuen Jen Yao of Alibaba Group Holding and Todd Anthony Combs of Berkshire Hathaway have retired by rotation following the last Annual General Meeting held on June 30.

Apart from the board rejig, the company had also approved the allotment of 5,44,870 equity shares to former and existing employees upon exercise of Employee Stock Options (ESOPs) by them.

Moneycontrol also reported last week that IPO-bound payments firm Paytm is also witnessing multiple high profile exits just ahead of its initial public offering including that of Amit Nayyar who was brought in to spearhead the company's financial services ambitions.

Paytm in its recent annual report said it had clocked revenue of Rs 3,186 crore for FY 20-21 vs Rs 3,540 crore in the previous year. It narrowed losses to Rs 1,701 crore during the same period from Rs 2,942 crore in the previous year.

Interestingly, this is not One97's first attempt to go public. In 2010, the company, which then used to provide value-added services (VAS) for telecom customers, planned to raise Rs 120 crore ($28 million basis a decade old conversion rate) through an IPO. It had to cancel its plan because of market volatility.