Online commerce and payments firm Paytm is likely to acquire two startups - Nearbuy and Little - for around $30 million, The Times of India reports. The deal will be a mix of cash and stock.
Nearbuy, formerly Groupon India, and Bengaluru-based Little, backed by Singapore's GIC and SAIF Partners, are two of the most well-funded daily-deals sites and are being acquired by Paytm in what TOI terms a distress sale.
Both the companies had together raised more than $80 million in capital and are now being bought out for around $30 million, in what is a mix of a cash-and-stock transaction, says the report citing people familiar with the matter.
Little Internet, which runs the Little app, had in 2015 racked up $50 million in investments and later got GIC on GIC. Paytm and GIC are significant shareholders after Tiger Global sold out from the company.
Gurgaon-based Nearbuy, broke off from its parent Groupon India in 2015 had scooped up a $20-million cheque from Sequoia Capital at the time.
Both the companies offer deals across restaurants, movies, hotels, salons, gyms, spas. Paytm, which has been betting on its online-to-offline (O2O) model, wants to bulk up this vertical with these platforms.
Valued at $7 billion, Paytm is ramping up its consumer offerings beyond its core payments business after raising funds from SoftBank earlier this year and has been looking to expand its presence in the hyperlocal space. The Vijay Shekhar Sharma-led company plans to invest an additional Rs 250 crore in its overall deals business, TOI's sources said.
Ankur Warikoo, co-founder and CEO of Nearbuy declined to comment on the matter while Paytm's founder and chief executive Sharma and Little's co-founder Manish Chopra did not respond to calls and text messages sent by TOI.
"These acquisitions have closed with the paperwork and other formalities being worked out. It should be made official in another three to four weeks," said a TOI source.
The latest acquisitions would enable Paytm to cross sell products and on its platform and push users to transact higher number of times. Having established its network of offline merchants, the company can use the deals platform to boost sales across various products like travel, movies, and restaurants among others.
The daily deals segment is struggling globally to sustain its business. Last year two of the founders of Nearbuy left the firm, which later shed a substantial number of jobs to keep afloat.