Unique: Vijay Shekhar Sharma will get new inventory choices forward of Paytm IPO

Bengaluru | Mumbai: Paytm founder Vijay Shekhar Sharma is getting a major quantity of recent inventory choices in One97 Communications, a transfer that may improve his stake within the mother or father firm by 2-3%, folks near the matter mentioned.

This comes forward of the
$2.2-billion Paytm IPO, billed as the largest in India in no less than a decade.

The digital funds agency
lately greater than doubled its ESOP pool to round 61,094,280 fairness choices of face worth Re 1 every from 24,094,280 fairness choices. Sources mentioned a “vital chunk” of those new inventory choices have been allotted to Sharma. “They sought the shareholder approval for ESOP pool enlargement in August, which was authorised earlier this month. Nearly half of it has been allotted to Sharma,” a supply mentioned.

Sharma, who holds round 15% stake in One97 Communications, is planning to promote part of his holding by means of a suggestion on the market (OFS) within the upcoming Paytm IPO.


The brand new inventory choices given to him will improve his holding even after he offloads part of his shareholding. These are performance-linked and primarily based on Paytm reaching sure milestones, sources mentioned. “That is additionally a manner of the administration rewarding Sharma for scaling Paytm so far (IPO) as a number one funds agency,” one other particular person near the corporate mentioned. In addition to Sharma, buyers like Ant Group, Alibaba Group, SoftBank and Elevation Capital are additionally anticipated to promote elements of their stakes within the Paytm IPO.

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When contacted, a Paytm spokesperson didn’t instantly reply to a question despatched by ET.

Pre-IPO strikes

To make sure, the allocation of recent inventory choices to Sharma shouldn’t be an anomaly as many top-tier founders have obtained such grants earlier than an IPO in order that they will reap the advantages of itemizing. On September 10, ET reported that founders of Tata-owned BigBasket
had been additionally granted new administration inventory choices to “retain, appeal to and inspire” expertise on the on-line grocer.

Over the previous few months, Paytm has seen its present and former executives
additionally changing their inventory choices to shares, hoping to money in throughout the IPO. In August, the corporate additionally granted new ESOPs to 166 former and present staff, which had been then transformed into shares of the corporate, regulatory filings accessed by ET confirmed.

Moreover, Paytm has formalised three appointments to the board of administrators:

  • Neeraj Arora, former chief enterprise officer of WhatsApp, as non-executive impartial director
  • Ashit Ranjit Lilani, managing accomplice of Saama Capital, as non-executive impartial director
  • Douglas Feagin, senior vp at investor Ant Group, as a director

Paytm had in July
filed a draft crimson herring prospectus with the markets regulator, the Securities and Change Board of India (Sebi), to boost Rs 16,600 crore ($2.2 billion) by means of a public difficulty.

The providing will comprise a recent difficulty price Rs 8,300 crore and a secondary difficulty or a suggestion on the market of the identical measurement, in line with the draft papers. The corporate has saved an open window for a pre-IPO funding spherical of as much as Rs 2,000 crore. If that occurs, the dimensions of the recent difficulty might be adjusted accordingly.

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