Exclusive: PhonePe set to acquire Indus OS for $60 Mn

Walmart-owned digital payments platform PhonePe is all set to acquire home-grown mobile platform Indus OS, said three people aware of the details of the transaction. 

This would be the second acquisition by the Bengaluru-based company since its inception. In July 2018, it acquired Zopper Retail.

“PhonePe and Indus OS have signed the terms of the deal two weeks ago,” said one of the people requesting anonymity. “The transaction is a cash deal worth $60 million.”

According to sources, the acquisition would bolster PhonePe’s Switch that aggregates various applications under its own app. It’s a kind of super app that enables PhonePe users to book cabs, hotels and order groceries and food items along with many other use cases.

“Post acquisition, team Indus OS will be spearheading Switch and building an app ecosystem for PhonePe,” said the second person who also wished not to be named. 

Indus OS claims to have 100 million users on its super app called Indus App Bazaar. The app has over 1.1 billion downloads and 400K apps across categories are listed on the platform. The sources said that PhonePe would enable in-app purchases for Indus App Bazaar.

“Following the deal, Indus OS’s investors would exit the company with cash and the team along with founders would join PhonePe,” said the person quoted above.

Queries sent to Indus OS and PhonePe didn’t elicit any immediate response. We will update the story in case they do.

Indus OS has raised around $20 million from Samsung Venture, Omidyar Network, JSW Ventures, VentureEast and Affle. Samsung and Affle control 20% and 8% stake in Indus OS which reported a revenue of Rs 17 crore for the year ended March 2020.

Indus OS eases app discovery in English and 12 vernacular languages across categories such as games, finance, entertainment and social media. In an interview, the company’s co-founder and chief executive Rakesh Deshmukh had said that its usages increased by over 2X during the first wave of the pandemic.