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Business News/ Companies / News/  Berkshire Hathaway exits Paytm with 507 cr loss
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Berkshire Hathaway exits Paytm with ₹507 cr loss

Since the listing, several marquee investors such as SoftBank, Ant Group have been diluting their holdings in the company.

BH International had initially invested ₹2,179 crore in Paytm at an average price of ₹1,279.7 per share.Premium
BH International had initially invested 2,179 crore in Paytm at an average price of 1,279.7 per share.

Mumbai: Warren Buffett’s Berkshire Hathaway or BH International has exited listed fintech company One 97 Communications (Paytm’s parent) in an open market transaction, bulk deals’ data published by bourses shows. The firm has booked a loss of 507 crore on its total investment in Paytm made five years ago.

BH International sold its residual 2.46% stake in Paytm (it had sold some stake during the company’s IPO in 2021) for 1,371 crore to Ghisallo Master Fund and Copthall Mauritius Investment. Ghisallo purchased 4,275,000 shares, and Copthall, 7,575,529 shares. The deal was struck at 877.2 per share, a 5% discount to Thursday’s close of 923.40.

Global investment bank JP Morgan helped execute the deal.

The transaction was executed on Thursday, following with the shares of Paytm fell 3.08% to close at 895 a share on Friday on the NSE.

Going by the red herring prospectus of One97 Communications, BH International’s average cost of acquisition was 1,279.7 a share. It had invested 2,179 crore in the company in September 2018.

During One97’s IPO, BH International had pocketed 301.70 crore, selling at 2,150 per share. Put together, the company has made a total of 1,672.7 crore from its investment in Paytm, essentially booking a loss of about 507 crore, Mint analysis shows.

Some of the marquee backers of Paytm, such as SoftBank and Ant Group, among others, have been cashing out of the company in recent times.

After seeing a major dip in its stock price upon listing, Paytm’s stock has been performing well on the bourses. In the past one year, the stock has risen 104%, against the 8% rise in the Nifty50 during the same period.

The fintech company said it narrowed its losses for the quarter ended September 2023 to 290 crore as against 571 crore in the same period of the previous fiscal.

It said its revenue from operations during the same period grew 32% on a year-on-year (YoY) basis to 2,519 crore. Earnings before interest, tax, depreciation and amortization or Ebitda for the quarter stood at 153 crore.

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ABOUT THE AUTHOR
Sneha Shah
Sneha writes on new economy businesses, private and public marker funding and deals. She writes about startups and the new economy, specifically PE/VC and investment banking.
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Published: 24 Nov 2023, 09:30 PM IST
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