Fintech unicorn Razorpay acquires PoS company Ezetap
Razorpay appears to be on an acquisition spree. The business-focused payment gateway aggregator and new banking platform has acquired Ezetap, a digital payment solutions provider in a primary and secondary deal, making it Razorpay’s third acquisition deal of 2022.
Razorpay has acquired a majority stake in Ezetap Mobile Solutions, according to Ezetap’s regulatory filings with 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 registrations also indicate that Helion Ventures, an early investor in Ezetap, still has a minority stake in the company after the acquisition. According to sources, Razorpay will also buy Helion’s stake in the coming weeks. “The deal is a mix of cash and stock that is likely to be in the $100-120 million range,” one of the sources said on condition of anonymity as transaction details are not yet public.
A decade-old Ezetap has raised about $50 million since its inception, including a 16 million dollars round in August 2017. Over the past 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 fundraising, but sources indicate that the effort did not go well. “Most of the pure point-of-sale (PoS) companies (except Pine Labs) are struggling,” added the source quoted above.
In January, a mint report highlighted that Razorpay was in early talks to buy a majority stake in Ezetap.
Razorpay has made back-to-back acquisitions in 2022. In February, it bought a majority stake in Kuala Lumpur-based Curlec and a month later it acquired fintech startup IZealiant Technologies for an undisclosed amount.
Ezetap provides software for fintechs including PoS solutions (point of sales), invoicing and loyalty solutions. It caters to industries such as bill payment and collection, insurance, grocery, restaurants and hospitality, retail and taxi services. The firm operates in India and the UAE and plans to expand it to Africa and the Middle East.
Byas Nambisan, CEO of Ezetap, recently claimed that the company had a turnover of Rs 150 crore by December 2021. In January, Nambisan elevated as co-founder of the company. Indian unit Ezetap recorded Rs 80.12 crore during FY21 from Rs 58.7 crore in FY20, according to the company’s annual accounts filed with the RoC. The company controlled its losses by 81% to Rs 8.76 crore in FY21 from Rs 46.45 crore in the previous financial year (FY20).
Inquiries sent to Razorpay and Ezetap did not immediately elicit responses. We’ll update the post in case they do.
Harshil Mathur-led Razorpay became the most privately valued fintech startup in India when it raised 375 million dollars to a value of 7.5 billion dollars last December. In addition to 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 too received RBI’s approval for a Payment Aggregator (PA) licence.
