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Public lender Axis Bank, which has announced the acquisition of Snapdeal's mobile wallet firm Freecharge intends to keep the firm as a separate entity and is waiting for the regulatory guidance, according to a top executive.
"Our intention of keeping Freecharge as a separate entity depends on the regulatory approvals. But generally what we want to do is to maintain this as an independent unit which can keep its own culture and the way what has made them successful in the past," Jairam Sridharan, chief financial officer of Axis Bank told Moneycontrol in an interaction on the sidelines of the acquisition.
"We don’t want them to become bankers necessarily. We would like them to continue to be fin-tech players," he added.
The board of Axis Bank has entered into a share purchase agreement with Jaspers Infotech Private Limited which runs Snapdeal to buy 100 percent stake in its payments subsidiary Freecharge in an all cash deal worth Rs 385 crore.
Moneycontrol had reported on Wednesday that the two companies had agreed to a sale of Freecharge.
While it wasn't immediately decided on who would head the new entity, Sridharan stressed that the company would like the old leadership to remain intact.
"We need to meet the team and sit together and figure out what is the best way forward," he said adding that all the employees of Freecharge will be retained post this acquisition. Freecharge currently has 200-250 odd employees.
Without commenting on the size, Sridharan said that Axis Bank would make "appropriate investments" in Freecharge to ensure a strong growth.
"We would like for Freecharge to have strong growth trajectory from here on," he said.
Freecharge had raised close to USD 116 million before it got acquired by Snapdeal for USD 400 million in 2015.
Talking about competition from the existing wallet firms like Softbank-backed Paytm, Sridharan said, "India is a very large market. Currently 90 percent of the market is not penetrated there is no point focusing on the 10 percent of remaining market."
Axis Bank also plans to integrate Freecharge's key features and functionality with some of the bank's current offerings.
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