Softbank to sell 4.5% stake in Paytm for $200-215 million

Japan-based Softbank has started the process to sell a 4.5 per cent stake in One97 Communications for about Rs 1,627 crore ($200 million) in a block deal, according to sources.

The development comes immediately after the lock-in period for Paytm's investors to trade shares ended.

Softbank is the second largest shareholder with a 17.5 per cent stake in the company.

According to two sources aware of the development, Softbank has offered to sell shares in the price band of Rs 555 to Rs 601.55 apiece that are held through its subsidiary SVF India Holdings.

Softbank expects to raise around Rs 1,627 crore at the lower end of the price band, Rs 555. Paytm shares closed at Rs 601.45 at BSE on Wednesday.

The deal may fetch Softbank around Rs 1,750 crore ($215 million) at the upper end. Softbank had invested Rs 13,025 crore ($1.6 billion) in Paytm in the last quarter of 2017 and offloaded shares worth Rs 1,791 crore ($220 million) at the time of IPO.

The current holding of Softbank at closing price is valued at around Rs 6,797 crore ($835 million).

"If we add Rs 1,791 crore ($220 million) that Softbank raised from selling stock at the time of Paytm IPO then about one-third of the investment that it made in One97 Communications has eroded," the source said.

Bank of America is the sole book runner for the deal.