One97 Communications, which owns India’s largest payments player Paytm, confirmed the investment by Berkshire Hathaway in the company on Tuesday adding that it is an “endorsement from world’s most respected investor for Paytm’s journey, and India’s long-term growth story.”
Berkshire Hathaway confirmed the investment on Monday evening. Both Berkshire and Paytm did not share the details of the transaction.
“Berkshire’s experience in financial services and long-term investment horizon is going to be a huge advantage in Paytm’s journey of bringing 500 million Indians to the mainstream economy through financial inclusion,” said Paytm founder and CEO Vijay Shekhar Sharma.
Berkshire has invested in some of the world’s largest financial services companies like Bank of America, Goldman Sachs, and Wells Fargo.
With this investment, Berkshire’s investment manager Todd Combs will join the eight-member board of the company. He will replace Amit Singhal, former head of Google’s search business, who has left the board of the company.
“I have been impressed by Paytm and am excited about being a part of its growth story, as it looks to transform payments and financial services in India,” said Combs.
Paytm was earlier valued at around $7 billion last year when it raised $1 billion from Softbank Vision Fund and around $10 billion earlier this year during a secondary share sale by employees of the company.
This investment is expected to help Paytm strengthen its market leadership against Flipkart-owned PhonePe and Google’s Tez besides potential competition from Facebook-owned WhatsApp and Reliance Jio.