Bharti Airtel in talks to acquire FreeCharge

Top telecom player Bharti Airtel is among the frontrunners looking at acquiring FreeCharge, an online mobile wallet platform in the Snapdeal portfolio, it is learnt. The telco had recently launched Airtel Payments Bank and it also has an online wallet-Airtel Money.

Bharti Airtel did not respond to a query sent by Business Standard on the subject. Without attribution, a company executive called it “market speculation”.     

Even as the Snapdeal board continues its negotiations with Flipkart to get a better valuation for the proposed merger of the two e-commerce companies, talks have restarted to sell FreeCharge. The acquisition of FreeCharge could happen in the next six to eight weeks, a source said.

According to sources close to FreeCharge, which has been on the block for quite some time now, has seen renewed interest from various players including some top banks too, besides Airtel.

Vijay Shekhar-led mobile wallet major Paytm has been in the race as well to buy rival FreeCharge. In fact, FreeCharge had signed a non-binding term-sheet with Paytm, but talks have not progressed much.

A source at FreeCharge said term-sheets from some of the potential buyers would be ready soon. 

FreeCharge did not respond to an email on the issue.

FreeCharge, which was acquired by Snapdeal for $400 million in 2015, is looking at a price of $75 million to $90 million in the current deal talks. Industry insiders said that as the price at which FreeCharge is being offered is quite reasonable, there may be takers.

The company offers sound backend tech platform, which would give a ready support to any player wanting to expand the wallet base, an analyst said. While FreeCharge has not given out numbers, it has an estimated 20 million wallet users and a million-plus offline merchant base.

Over the past few days, there have been several townhall meetings at FreeCharge where senior management have told employees that the company would be acquired within the next two months. 

“In the townhall meetings, employees have been told that they would be given retention letters, the rollout of which has already started. Over the next few months, employees would get money in lieu of the retention letters,” said an employee at FreeCharge.

According to sources, Jason Kothari, recently appointed as chief executive officer of FreeCharge, has been in talks with investors in the US and China also. PayPal was initially interested in investing in FreeCharge but the deal could not be closed. 

Sometime back, another mobile wallet player MobiKwik had also shown interest in buying the firm but the deal fell through.