PhonePe-ZestMoney deal pegged at $200mn-$300mn called off due to diligence concerns
1 min read 30 Mar 2023, 01:06 PM ISTThe deal between Walmart-backed PhonePe and Zest Money is off. The company's board and investors were made privy to the development over the last few days
PremiumPhonePe, one of India's largest fintech platforms, has put on hold its plans to acquire Bengaluru-based BNPL (buy now pay later) platform ZestMoney. The deal amount was pegged at $200 million-$300 million.
The digital payments platform has called off the deal with ZestMoney over due diligence concerns, following months of discussions with the BNPL startup, according to a report by the Economic Times.
Further, the report said that the deal is off, and that the company's board and investors were made privy to the development over the last few days.
The buyout would have given the Walmart-owned company access to an NBFC (non-banking finance company) licence, which it has been looking to own since long.
The move came as a blow to ZestMoney, as it battles a funding crunch in an ecosystem where venture capitalists and investors have become extra cautious while signing big checks.
ZestMoney raised its last funding round at $450 million valuation.
The the buy-now-pay-later platform has been looking for a buyer as it has struggled to raise funding. According to earlier reports, ZestMoney was in acquisition talks with Pine Labs and BharatPe earlier, but the deals fell through.
ZestMoney, which was founded in 2015, has raised about $140 million till date from marquee investors, including PayU, Zip, Ribbit Capital, Quona Capital, Xiaomi, Omidyar Network, Goldman Sachs, others.
During financial year 2022, ZestMoney saw its revenue rise to ₹145 crore from ₹89 crore in FY21, while losses jumped to ₹398.8 crore from ₹125.8 crore a year ago.
