One 97 Communications, which owns fintech firm Paytm, is set to raise approximately Rs. 2,000 crore ($300 million) from global investment banking firm Goldman Sachs, Singapore's sovereign wealth fund Temasek and Taiwan's semi-conductor firm MediaTek.
The new round of funding, which will also see participation from Chinese internet major Alibaba and its payment affiliate Alipay, is expected to raise the company's value to $5 billion, which is twice its valuation at $2 billion in May this year.
The fund will be divided between Paytm's various businesses, which include e-commerce, online payment solutions and the yet-to-be launched payments bank.
One97 has started launching new entities to give better focus to its diverse business. CEO Vijay Shekhar Sharma incorporated Paytm eCommerce Private Limited to branch off its retail business, while Paytm Payments Bank Limited was also registered for its soon-to-be-launched payments bank business.
Paytm's e-commerce entity is also said to be a via-media for the Chinese major Alibaba to access the Indian market. Alibaba and its affiliate Alipay had made a total investment Rs. 4,400 crore in 2015, while Paytm said it received around Rs. 453 crore ($675 million) from the two companies.
Until now, Alibaba's affiliate company Alipay is the largest stakeholder in One 97 Communications with 32.41 percent stake, while investment firm SAIF Partners and founder Sharma has 30.81 percent and 21.33 percent stake, respectively, in the company. Alibaba has 8.53 percent stake in Paytm's parent company.
The deal, when it completes, will be the largest funding round surpassing Snapdeal's $200 million funding and grocery start-up Big Basket's $150 million.
In July, Paytm group's Gross Merchandise Value (GMV) almost touched Rs. 2,000 crore, while Paytm online marketplace GMV contribution was around Rs. 250-300 crore.
While online retail major Flipkart reported GMV of less than Rs. 2,000 crore, Snapdeal's GMV came at around Rs. 600 crore.