PayU Buys Citrus Pay For $130 Million In An India’s Biggest FinTech Acquisition Ever

Gurgaon-based digital payments provider PayU India, which is owned by South Africa's Naspers Group, said on Wednesday it will buy Mumbai-based payment startup Citrus Pay (Rs 865 crore) for $130 million, the fifth-largest deal ever in the Indian start-up business.

The acquisition is expected to close by the end of the year and is also expected to yield handsome cash returns to venture capital investors who backed the 5-year-old company, a rare instance in the Indian startup landscape. Sequoia Capital, the earliest backer of Citrus Pay, which had invested about $10 million and owned a 32% stake in the venture, is expected to earn a four-fold return on its investment, while Ascent Capital, which bought a 8% stake last year, has earned about $12 million, according to sources.

After the acquisition, PayU India will have more than 30 million customers. The company forecast that it will process an estimated 150 million transactions worth $4.2 billion in 2016.

"Today’s announcement is a significant milestone for both businesses, as well as the FinTech industry in India,” PayU’s global operations CEO Laurent le Moal said in a statement. "It is exciting for everyone across the PayU and Citrus teams as we bring together new capabilities that will help us to better serve our collective clients."

The deal places CitrusPay CEO Amrish Rau at the head of PayU’s India operation, which apparently means that the two companies will be completely merged and CitrusPay’s brand will cease to exist. The deal could also see PayU co-founder Nitin Gupta leave the company to launch a new startup probably.

CitrusPay and PayU have very similar business models and both were established in 2011. PayU maintains operations around the world. Its India branch offers net banking, credit and debit options and allows users to attach their digital wallets to their regular checking accounts for the purpose of making purchases online. The company received a “semi-closed wallet license” from the Reserve Bank of India in August. The Boston Consulting Group said in July they expected the Indian digital payments market to reach $500 billion by 2020.

Kabadiexpress Gets $148K in Seed Funding and Drivify Secured $50K from Citrus Pay Founder

Delhi-based company, Kabadiexpress which collects waste from door to door, has raised Rs 1 crore ($148k) in seed funding while On-demand driver app Drivify, backed by Mumbai-based startup DR Mobility Solutions Pvt. Ltd, has raised $50,000 (Rs 33.75 lakh) in seed round.

Kabadiexpress Raises $148k in Seed Round of Funding

Delhi-based company, Kabadiexpress which collects waste from door to door, has raised Rs 1 crore ($148k) in seed funding from an affluent individual in the real estate segment. The company which is owned and operated by Green Warriors Pvt. Ltd, will use the money for expanding its presence to Noida, Ghaziabad and other NCR areas (national capital region). Founded in May last year by Kapil Bajaj and Sandeep Sethi, Kabadiexpress collects waste items like old newspapers, magazines, furniture, electronic products and metal objects and sells these to recycling plants and mills. It competes with players like EnCashea, Karma Recycling, Pom Pom and Attero Recycling.

“Passing through a revolutionary phase of new era, we are stepping ahead to save our environment and lead to a healthy and happy living. we help you to manage your waste paper and other scrap effectively and at same time use it for serving a better purpose rather then throwing it away to cause pollution,” the startup mentioned on its website.

On Demand Driver App Drivify Bags $50k in Seed Funding from Citrus Pay Founder

On-demand driver app Drivify, backed by Mumbai-based startup DR Mobility Solutions Pvt. Ltd, has raised $50,000 (Rs 33.75 lakh) in seed funding from Citrus Pay founder Jitendra Gupta and a HNI Pankaj Tripathi. The startup will use the funds to improve and expand the platform, acquire customers and give incentives to drivers, as per VCCircle report.

Drivify was founded in May 2015 by Prasad Shriyan and Jatin Kamdar, lets car owners search and book drivers instantly. The app scans for a driver within a 10 km radius of the user. Users get drivers’ details on the app and can also track the selected driver on a map within the app. They can also pay through the app.

The startup claims to have about 700 registered drivers, out of which 70 drivers are actively involved. The company is currently operational in Mumbai and plans to expand to Delhi, Pune, Bangalore and Hyderabad by the end of this year. It competes with DriveU, DriversKart, Zimmber, Zuver and Driver Bulao, among others.

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