Prosus to acquire BillDesk for $4.7 billion

The Dutch tech giant said the deal will give its fintech holdings in India a cumulative investment value of over $10 billion

Dutch tech giant Prosus today said that it would acquire India-based payments provider BillDesk for $4.7 billion. Prosus plans to combine BillDesk with PayU, its existing global fintech and payments business, which already has a strong presence in India. The deal has been rumoured to be in the works since about July.

The proposed acquisition will make PayU one of the bigger online payment providers globally with nearly $147 billion in payment volume annually. But the proposed all-cash deal is not only a significant consolidation move in the world of payments: it also underscores Prosus’ continuing focus on developing markets and specifically India. Prosus said that the deal — one of the biggest ever made by Prosus, and one of the biggest M&A moves in India — will give its fintech holdings in India a cumulative investment value of over $10 billion.

The proposed acquisition will require approval from the Indian regulator Competition Commission of India. In a call with reporters Tuesday, Prosus and PayU executives said they don’t expect much hurdle in receiving the approval as PayU and BillDesk offer complementary businesses. BillDesk’s network is used by India’s largest banks and by a large number of merchants across utilities, telecom, insurance, mutual funds, travel and e-commerce verticals.

Payments and fintech is a core segment for Prosus and India remains our number one investment destination, said Bob van Dijk, group CEO of Prosus, in a statement. PayU had made a number of acquisitions over several years, and is currently active in nearly 20 markets.

India represents a huge market for financial services, with a digitally savvy consumer base with a rapidly expanding middle class with disposable income.

PayU has positioned itself as a strong player in India. Specifically, it has been highly competitive in the Indian online merchant acquiring market — both on price and in-field sales effort. PayU India has a dominant share in the payments gateway business where it traditionally competed with BillDesk and CCAvenue — and of lately, RazorPay.

Anirban Mukherjee, CEO of PayU India, suggested on a call today that Prosus may explore expanding BillDesk’s business outside of the world’s second-most populous nation — though a concrete decision hasn’t been made.

We believe this transaction will stimulate both innovation and competition within India’s digital payments industry, said Laurent Le Moal, CEO of PayU, in a statement. This will not only help to strengthen India’s digital economy, but also bring financial services to those who may have historically been excluded. This ambition is fully aligned with the Government of India’s vision of ‘Digital India’ and is a key objective for PayU across all the communities we serve globally.