Infibeam, India’s first e-commerce company to get listed, is now planning to merge itself with online payments platform CC Avenue. The deal is said to value the payments service providing company at around Rs. 2,000.
As per the reports, Infibeam, which already owns 3.85% stake in CC Avenue through subsidiary NSI Infinium Global, has agreed to acquire another 7.5% stake in it by investing around Rs. 150 crores. Regarding the merger, the companies are entering into a MoU (memorandum of understanding).
Infibeam’s latest investment is funded partly through internal accruals and equity debt. After the stake buyout, the board of directors have given their nod for subsequent amalgamation of CC Avenue into Infibeam by the issuance of fresh shares, which is subject to due diligence and regulatory approvals.
Commenting on the investment, Vishal Mehta, founder and CEO at Infibeam, said,
In June last year, we did a strategic investment in CCAvenue. We will integrate payment as part of our existing framework of build-a-bazaar, which is a distributed market place. As a result, we will meet the merchant requirement of a payment gateway.
Integration of Payment platform with logistic & warehousing, ad and domain registry along with data centre and data analytics, the value added services provided by Infibeam makes a full circle in providing all services under one roof to the customers.
He added that the entire payment company is being merged into Infibeam and post the merger and the subsequent regulatory approvals, the promoters of CCAvenue will get the shares of Infibeam.
CCAvenue, which is not yet listed, is one of the largest payment aggregator companies in India. Its platform is available to more than 1 lakh merchants to collect payments online. It has tie-ups with about four dozen banks.
The company will soon have the Bharat Bill Payments Systems which will facilitate all bill payments for utilities and services. It had nearly 66,000 merchants on its e-commerce platform at the end of December.
Infibeam caters to B2E, B2B and B2C segment of business for its customers. Integration of Payment platform with logistic & warehousing, ad and domain registry along with data centre and data analytics, value added services provided by Infibeam make a full circle in providing all services under one roof to the customers.
Infibeam Incorporation’s consolidated revenue for the quarter came in at Rs. 102.7 crore, registering 10.4% quarter-on-quarter decline. Earnings before interest, tax, depreciation and amortization (EBITDA) for the quarter rose by 2.4% qoq to Rs. 17.1 crore. EBITDA margin for the quarter stood at 16.7%.
The company’s Profit After Tax (PAT) for the quarter came in at Rs. 12.5 crore, quarter-on-quarter increase of 60.3%. This was driven by increase in other income to Rs. 4 crore in Q3FY17 as compared to Rs. 1.1 crore in Q2FY17. As of the number of active users, the company reported 8.11 million active users, a Y-o-Y growth of 0.31 million or 4%.
Infibeam’s Distributed E-Commerce Market Place segment revenue growth has been significant and has grown by 49% to Rs 402 Mn in Q3FY17 compared to Q3FY16. The number of merchants comprising of Enterprise, SME’s & MSME’s on their BuildaBazaar platform has increased to 66,109 up by 36% compared to previous year.