Alibaba to debut in India’s mobile commerce space

Chinese eCommerce giant Alibaba is going to foray into India’s fast growing mobile commerce space. It will buy 25% stake in India’s One97 Communications, which is the parent company of mobile commerce firm Paytm.

Ant Financial Services (AFS), part of the Alibaba Group, has announced a strategic agreement to acquire "a 25% stake in One97 to support the growth of mobile payment and commerce platform in India."

Alibaba, largest eCommerce company in the world, had garnered a sum of $25 billion through initial public offering (IPO) in the US in September 2014.

"Paytm will use the funds to grow its mobile payment ecosystem and further boost its commerce user base. The deal represents Ant Financial's first-ever investment into an Indian company," Alibaba added.

"With over 1 billion people, India's payments market has vast untapped potential," said Cyril Han, vice president, Ant Financial Services. AFS will also provide strategic and technical assistance to Paytm.

Citi and Goldman Sachs acted as the financial advisors on the deal. Simpson Thacher & Bartlett, Trilegal and Amarchand & Mangaldas and Suresh A Shroff & Co were the legal advisors.

AFS was set up in October last year, and it focuses on small and micro enterprises (SMEs) and consumers. It runs businesses like Alipay, Yu'e Bao, Zhao Cai Bao and Ant Credit and Alipay Wallet.