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IPO-bound Pine Labs buys majority stake in payment solutions firm Mosambee
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Initial public offering (IPO)-bound merchant commerce platform Pine Labs on Wednesday said it has picked up a majority stake in payment solutions provider Mosambee, for an undisclosed sum.    

The new investment by Pine Labs will value Mosambee at upwards of $100 million.

VCCircle exclusively reported the development on April 5.

Mosambee, operated by Synergistic Financial Networks Pvt. Ltd, had earlier hired mid-market-focused boutique investment bank DC Advisory to scout for potential investors. 

The company counts Rajasthan Venture Capital Fund (RVCF) and SIDBI Venture Capital Ltd among its existing investors.   

Post this transaction, Mosambee’s leadership team will continue to operate independently.    

“Ever since its launch, Mosambee has made tremendous inroads into elevating the merchant experience through cutting-edge fintech solutions. They were a natural fit for us due to our shared purpose of making innovative fintech products accessible to all and driving forward the digital payment revolution in India,” said Amrish Rau, CEO of Pine Labs.    

In February, Mosambee acquired buy-now-pay-later (BNPL)-focused payment startup Benow to deepen its presence across the country.

The company had then claimed its revenue has jumped from Rs 2 crore to around Rs 140 crore in four years. Amidst the pandemic, the payments company claimed it had registered 25% growth during the fiscal year 2021 and plans to further achieve 50% growth in FY22.    

Mosambee is also planning to step up its efforts in building MSME-focused products to facilitate digital inclusion.     

In 2015, Mosambee had raised an undisclosed amount in its Series B round of funding from existing investors Rajasthan Venture Capital Fund (RVCF) and SIDBI Venture Capital Ltd.   

“Pine Labs was our first partner when we launched our platform. Mosambee today caters to a wide array of businesses, from SMEs to private and government entities to leading banking institutions in India. With the extensive reach of Pine Labs and their portfolio companies, we aim to continue to deliver strong profitability and breakthrough solutions to our clients,” said Sameer Chugh, Co-Founder of Mosambee.

Pine Labs has been active in M&A (mergers and acquisitions), and it has struck a few acquisitions in the recent past. In February it acquired out payments startup Qfix Infocomm, for an undisclosed amount. Earlier, Mint reported that Pine Labs is in advanced negotiations to acquire API infrastructure company Setu.     

Pine Labs had previously acquired QwikCilver in 2019 for which it raised capital from Actis Advisors. In the past, the company acquired Southeast Asia-based fintech platform Fave for $45 million (Rs 337 crore) in April 2021.    

In July 2020, Pine Labs made a strategic investment in Fave.   

The fintech unicorn (startups valued at over $1 billion) raised $50 million (around Rs 380 crore) in fresh funding from Vitruvian Partners. The startup is said to have been valued at $5-$5.5 billion for the said transaction.

Last month, Pine Labs raised $150 million (about Rs 1,120 crore) from Alpha Wave Ventures. In May 2021, the company raised a tranche of $285 million from a clutch of reputed public market-focused cross-over funds, pushing its valuation to around $3 billion. In August 2021, Pine Labs roped in CRED founder Kunal Shah on its board.   

Earlier VCCircle reported that Pine Labs may defer the IPO process till later this year due to "weak market sentiments". It was planning to launch its Nasdaq listing process in January-February and had hired Goldman Sachs and Morgan Stanley to formalize the process.     

Rajul Garg launched Pine Labs in 1998, but later left the company. Its current Chairman Lokvir Kapoor then took over the firm.

Pine Labs’ solutions are used by merchants from diverse sectors—electronics, food and beverage, fashion, pharmacy, telecom and airlines, but these are mostly offline players.

The company is also planning to ramp up its online platform, both by organic and inorganic means.

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