Paytm parent One97 says MediaTek to invest $60 million

MUMBAI (Reuters) - Taiwan's largest chip designer MediaTek Inc is investing $60 million in India's One97 Communications, valuing the payment services and e-commerce firm at about $5 billion, the company said on Tuesday.

One97, which operates under the trade name Paytm, is looking to raise a total of $300 million to expand its payments and e-commerce businesses, and also to build a so-called payments bank for which it has won a permit.

The company is in talks with new as well as existing shareholders and expects to raise the remainder of the $300 million in the coming months, a spokeswoman said.

Alibaba Group is One97's largest shareholder after the Chinese e-commerce giant and its finance arm Ant Financial Services invested last year in the company founded by entrepreneur Vijay Shekhar Sharma.

MediaTek is also a shareholder in Paytm's competitor MobiKwik which last week sealed an up to $40 million investment from Net1 UEPS Technologies Inc.

(Reporting by Devidutta Tripathy; editing by David Clarke)