Alibaba to join Indian e-commerce battle with fresh funding in Paytm

By

Maverick Martins

Published
Feb 3, 2017

Alibaba, the world's largest ecommerce company will soon be joining the battle in India to take on leading players like Amazon and Flipkart. The company is leading an investment round of between Rs 1,350 crore and Rs 1,700 crore in the online retail marketplace of Paytm to officially enter the Indian e-commerce market, according to two people aware of the deal.

Alipay, the payments affiliate of Alibaba, and investment firm SAIF Partners have also participated in the deal which is expected to value the online marketplace — spun out of parent company One97 Communications — at over $1billion, according to a report in the Economic Times.

"The Alipay-Alibaba combine will now own over 50 per cent in the unit," said one of the people cited above who termed this an opportune time for Alibaba to enter the fray.

"The online marketplace business will either be called PayTM Mall or PayTM Bazaar," said the person who estimates the business has annualised gross merchandise value (GMV) of about $1billion. The closure of the deal is expected to be formally announced in the coming weeks.

A representative for Alibaba said the company regards India as an important emerging market with great potential and is absolutely committed to developing this market for the long term.

Alibaba was widely expected to begin business in India as Tmall, its business-to-consumer brand in China, to differentiate its business from Paytm's digital payment brand. But the online retail marketplace will now continue under the Paytm brand.