NEW DELHI : Paytm's US$2.2 billion IPO is facing an unusual hurdle - a 71-year-old former director has urged India's markets regulator to stall the offering, alleging he is a co-founder who invested US$27,500 two decades ago but never got shares.
Saxena has approached the Securities and Exchange Board of India to stall the IPO, arguing investors could lose money if his claim is proved right, according to a previously unreported complaint seen by Reuters.Shriram Subramanian of shareholder advisory firm InGovern said the tussle could spark regulatory inquiries and complicate or delay the approval of Paytm's IPO that could value it at up to US$25 billion.
At the heart of the dispute is a one-page document signed between Saxena and Paytm's billionaire CEO, Vijay Shekhar Sharma, in 2001. Seen by Reuters, it says Saxena was to get a 55per cent equity stake in Paytm's parent, One97 Communications, with Sharma owning the rest.Reuters reviewed a June 29 response the company gave to the Delhi Police, where it says the document was"merely a letter of intent" which"did not materialize into any definitive agreement".
Around 2003-2004, Paytm argues it had transferred the shares to an Indian firm as it was"informed" that Saxena had reached a private understanding with them. Saxena said he never received any shares and there was no such understanding.