SoftBank sells 2% stake in Paytm amid regulatory crisis

One97 Communication Limited

SoftBank sold more than 13.7 million shares, or about 2.17 percent in Paytm, in the open market over the past month even as the fintech major's stock price took a beating due to a regulatory crisis.

With the latest sale, the Japanese investor's stake in Paytm’s parent One97 Communications has been pared down to 2.83 percent.

"SVF India Holdings (Cayman) Limited has disposed of an aggregate of 13,784,787 equity shares of One97 Communication Limited in a series of disposals undertaken between January 23,2024 and February 26, 2024, with a disposal on February 26, 2024 breaching the 2% threshold specified in Regulation 29 (2) of the SEBI Takeover Regulation,” the firm said in a statement.

According to sources, SoftBank was looking to eke out a slim net gain on its Paytm investment, but the drop in the stock's price due to the RBI action has led to a situation where the Japanese investor is now staring at a loss of $100-150 million on one of its biggest India bets.

SoftBank had previously disposed 12,706,807 equity shares between December 19,2023 and January 20,2024 at about Rs 950 crores, paring its stake to about 5.01 percent from 7 percent previously.

The Paytm stock took a beating after the RBI crackdown on Payment Payments Bank on January 31. It tanked around 60 percent before recovering a bit by hitting the 5 percent upper circuit for several sessions back-to-back.

On Thursday, Paytm shares continued to traded in the red for the third straight session.  At 9:30am, the fintech stock was hovering on 5 percent lower circuit at Rs 385.90 on the National Stock Exchange (NSE).

(This is a developing story)