India's largest private bank HDFC Bank has acquired a 7.75 per cent stake in fintech start-up Mintoak for Rs 31 crore, a regulatory filing stated on Wednesday. As per the details, HDFC Bank signed an agreement on December 13, 2022, following which it will subscribe to 21,471 fully paid-up Compulsory Convertible Preference Shares (CCPS) of the face value of Rs 20 each at a premium of Rs 9,711. The total consideration will be Rs 9,731 per CCPS.
The regulatory filing stated that the private bank will also purchase 10,538 fully paid-up equity shares of Mintoak for a consideration of Rs 9,731 per share from certain existing shareholders of Mintoak.
Mintoak is a fintech start-up that offers a payments-led platform with many value-added services so that merchants can connect with their customers. For acquirers, Mintoak enhances their engagement with merchants through its digital offerings. As per the details submitted to the Securities and Exchange Board of India (Sebi), Mintoak’s turnover (operating income) was Rs. 11.28 crore and PAT was Rs. 1.47 crore for the year ended March 31, 2022. Mintoak was incorporated in 2017.
The acquisition deal is likely to be completed by January 31, 2023, which will depend on the conditions precedent. As the overall stake of the bank after the transaction will be less than 10 per cent, this will not require regulatory (Sebi’s) approval. The bank said that it invested in a growing fintech startup that offers payments and value-added services to its merchants and enhances the digital engagement of acquirers with merchants to make the digital payment platform accessible.
In 2021, HDFC Bank invested Rs 10.3 crore in Mintoak and acquired 5.3 per cent stake in the company on a fully diluted basis.
In October this year, HDFC Bank launched its SmartHub Vyapar Merchant app, which was developed along with Mintoak. The SmartHub Vyapar Merchant app is a payments and banking solution for small and medium-sized businesses, which enables merchants to accept interoperable payments across multiple payment modes which include Cards, UPI, and QR codes. The bank claims to be adding more than 75,000 merchants every month.
For merchants who are not into technology and related operations, the app offers an option to send a payment link on mobile or email to facilitate a non-face-to-face collection.
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