Razorpay seems to be on an acquisition spree. The business-focused payment gateway-aggregator and neo banking platform has acquired Ezetap, a digital payments solution provider in a primary and secondary deal, making it Razorpay’s third acquisition deal in 2022.
Razorpay has bought a majority stake in Ezetap Mobile Solutions, according to Ezetap’s regulatory filings by its holding company in Singapore. The acquisition is a mix of primary and secondary transactions and Razorpay will acquire more than 80% stake in the Bengaluru-based company.
The filings further indicate that Helion Ventures, an early investor in Ezetap, still has a minority stake in the company following the acquisition. According to sources, Razorpay will also acquire Helion’s stake in the coming weeks. “The deal is a mix of cash and stock which is likely to be in the range of $100-120 million,” said one of the sources on condition of anonymity as transaction details are not public yet.
A decade-old Ezetap has raised around $50 million since inception including a $16 million round in August 2017. During the last four years, it has managed to raise funds from existing investors including Js Investments and Social capital in small tranches.
Ezetap was also looking to raise around $60 million and had mandated Unitus Capital for the fundraise but sources indicate that the efforts didn’t fare up well. “Most of the pure-play point of sale (PoS) companies (excluding Pine Labs) are struggling,” added the source quoted above.
In January, a Mint report highlighted that Razorpay was in early talks to acquire a majority stake in Ezetap.
Razorpay has made back-to-back acquisitions in 2022. In February, it acquired a majority stake in Kuala Lumpur-based Curlec and a month later, it took over fintech startup IZealiant Technologies for an undisclosed amount.
Ezetap provides software for fintechs including PoS (point of sales) solutions, billing, and loyalty solutions. It caters to the industries like bill payment and collections, insurance, FMCG, restaurants and hospitality, retail and taxi services. The firm operates in India and UAE and it’s planning to expand it to Africa and the Middle East.
Byas Nambisan, CEO of Ezetap, recently claimed that the company was clocking Rs 150 crore in revenue by December 2021. In January, Nambisan was elevated as co-founder of the company. The Indian entity of Ezetap registered Rs 80.12 crore during FY21 from Rs 58.7 crore in FY20, as per the company’s annual financial statement filed with RoC. The company controlled its losses by 81% to Rs 8.76 crore in FY21 from Rs 46.45 crore in the preceding fiscal year (FY20).
Queries sent to Razorpay and Ezetap did not elicit an immediate response. We’ll update the post in case they do.
Harshil Mathur-led Razorpay became the top most privately valued fintech startup in India when it raised $375 million at $7.5 billion valuation in December last year. Besides three acquisitions, it also organized an ESOP sale for its 650 existing and former employees as part of a $75 million transaction. Last month, the company also received RBI’s approval for a Payment Aggregator (PA) License.
