Walmart-owned digital payments firm PhonePe, mobile platform Indus OS, Affle Global Pte Ltd (AGPL) and Ventureast (VPF) said that they are moving towards an out of court settlement regarding the dispute about PhonePe acquisition of Indus OS.
In a joint statement, the firms said that the settlement of the dispute involving VPF shares in Indus OS is a significant step towards a greater outcome for Indus OS and its stakeholders.
The joining of many important forces (Indus OS Founders, PhonePe, Samsung and AGPL) would anchor Indus OS in the next part of its value creation journey.
“The strategic confluence of parties and the long-term alignment could not have been accomplished without the initial strife, and the subsequent maturity of vision and leadership by all parties,” said the companies in a statement on Wednesday night.
Different parties have played supporting roles in the Indus OS journey. Ventureast played a key role in the initial stages of bringing in angel investors and VC investors even before they were an investor, and subsequently was the investor who backed Indus OS in a maximum number of rounds. AGPL has delivered strategic value creation and sustainable growth.
“Now with PhonePe’s involvement last year, and the long-term alignment of the founders, PhonePe, AGPL and Samsung that is coming about now, the value accretion may be huge for all stakeholders including the entrepreneurs and consumers in India,” said the companies.
The issue goes back to last year when PhonePe was in the process of acquiring Indus OS for $60 million. The acquisition was expected to help PhonePe in its “super app and vernacular language” strategy to integrate various apps on its platform. The move was expected to help PhonePe to compete better with players such as Paytm, Google Pay and Amazon Pay, which are also building similar capabilities.
PhonePe had placed a bid to acquire 92 per cent stake in Indus OS at a valuation of around $60 million. However, the biggest shareholder in the company, Affle Global Pte Ltd (AGPL), had opposed the deal and challenged it legally. Last year in June, AGPL, a digital advertising firm, claimed to have won the initial legal battle in a case filed against it by PhonePe in a Singapore court in the Indus OS stake sale matter. AGPL had estimated that the valuation of OSLabs, known as Indus OS, was around $90 million and had refused to sell its 25 per cent stake at a lower valuation.
AGPL had filed an injunction suit against the resolution passed by Indus OS approving stake sale to PhonePe which was challenged by the fintech firm in a Singapore court. Both AGPL and Indus OS are registered in Singapore. AGPL had claimed that PhonePe has clearly lost the corporate legal battle in Singapore. However, PhonePe and OSLabs had refuted the claims made by AGPL that it has won the legal battle.PhonePe had said that AGPL has issued incorrect statements and the matter is sub-judice and no final finding has been given yet.
Indus OS, founded by three IITians, Rakesh Deshmukh, Akash Dongre, and Sudhir B in 2015 is a leading home-grown app-content-discovery platform that helps smartphone users consume apps and content in the language of their choice. The company operates a full-fledged Android app store, known as Indus App Bazaar. It is backed by the venture capital arm of smartphone maker Samsung.
Indus OS which runs the world’s largest indigenous app store had witnessed over 1.1 billion app installs. The acquisition was expected to give PhonePe access to Indus OS’ over 100 million users and 400,000 apps across all categories. The platform is available in about 13 languages. This would particularly help PhonePe’s Switch platform which allows customers to seamlessly switch between PhonePe and their preferred apps in categories such as food, grocery, health and fitness, shopping and travel and entertainment, within the PhonePe app itself.
PhonePe on Wednesday said that it has processed more than 100 million transactions in a single day. This phenomenal milestone is achieved on the back of the highest end-to-end success rates in the industry. The firm currently processes over 2.5 billion transactions a month at an Annual TPV (total payment value) run rate of $780 billion and is India’s leading fintech platform. PhonePe’s phenomenal growth comes on the back of rapid traction across Tier 2, Tier 3 cities and beyond.
Source: Business-Standard