Renowned investor Warren Buffet-led Berkshire Hathaway has picked up a stake worth $356 million in the parent company of Noida-based digital payments and E-commerce app Paytm, the latter has announced.
This deal marks as the American multinational holding conglomerate's first investment in an Indian startup, with which it will be entering the country's financial services sector.
The digital payment startup, since its launch in 2010, has become one of India's leading virtual payment apps and the latest development would be yet another significant endorsement for the Vijay Shekhar Sharma-led company.
Berkshire Hathaway will add to the company's existing lineup of investors which currently includes China-based Alibaba Group, Ant Financial Services Group, as well as Japan's SoftBank.
“We feel both excited and humbled by this endorsement. Berkshire’s experience in financial services, and long-term investment horizon, is going to be a huge advantage in Paytm’s journey of bringing 500 million Indians into the mainstream economy through financial inclusion It is my honour to welcome Todd to our board, where he will bring his wealth of experience to guide our management team.” Paytm founder and CEO Vijay Shekhar Sharma said in an official release.
The news also signifies a departure from Berkshire Hathaway's traditional investment destinations which usually include companies from the consumer, energy and insurance sectors.
“I have been impressed by Paytm and am excited about being a part of its growth story, as it looks to transform payments and financial services in India.” Todd Combs, Investment Manager of Berkshire Hathaway said in an official release
This move by the American company comes after its CEO Warren Buffet, in May, hinted at an interest in the financial payment industry at an annual shareholders meeting, stating that it was a huge deal around the world and that numerous companies were eager to try their hand in it.