PhonePe is relocating its headquarters to Bangalore, similar to online retailer and former parent company Flipkart.
Walmart Inc and other shareholders of PhonePe will have to pay nearly $1 billion in tax after the digital payments company moved its headquarters to India, according to people familiar with the matter.
The bill stems from the transfer and price hike of PhonePe Pvt, which Walmart took majority after acquiring parent organization Flipkart Online Services Pvt. Now demerged from Flipkart and re-domiciled in India from Singapore, the fintech firm is raising funds from General Atlantic, Qatar Investment Authority and others at a pre-money valuation of $12 billion, raising huge Charges are being levied, people asked not to be named, discussing a personal matter.
New investors, including Tiger Global Management, have now bought PhonePe shares in India at the new price, with tax implications of about 80 billion rupees for existing shareholders, a person said.
Representatives for Walmart, Flipkart and Tiger Global did not immediately respond to an email seeking comment. A spokesperson for PhonePe declined to comment.
PhonePe is relocating its headquarters to Bangalore, similar to online retailer and former parent company Flipkart. Going home is an unusual move for an Indian startup. Over the years, technology companies with most of their operations and business in India have chosen to incorporate in Singapore because of the friendlier tax regime, ease of receiving foreign investment and simpler procedures for public debuts on overseas exchanges.
According to a report by India Briefing, more than 8,000 Indian startups have been incorporated in Singapore since the year 2000. PhonePe's three key moves - relocating to India, carving itself out as a separate entity from Flipkart and raising funds at higher valuations - come at a time when startup firms around the world are struggling to raise funds and facing depreciation. are facing
PhonePe's innings could be a precursor to the digital payments company preparing for a stock market listing in India. One of the people said any payments firm listed overseas would struggle to get the green light from India's financial and banking regulator, the Reserve Bank of India. India currently prevents India-headquartered companies from directly listing on foreign exchanges.
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