Comviva Technologies Ltd, a subsidiary of Tech Mahindra Ltd, has divested its stake in fintech company TerraPay Payment Services (Netherlands) BV as part of a broader deal.
The broader deal involves TerraPay raising $9.6 million (about Rs 70 crore) in funding from International Finance Corporation, global technology investor Partech Partners and Prime Venture, Mahindra Comviva said it in a statement. It didn’t disclose the value of its stake.
The development comes after VCCircle in July last year reported that IFC had joined a consortium of investors that was in talks to seal a venture-stage management buyout-style transaction for TerraPay.
The deal marks an uncommon transaction in India for Washington-based IFC, which actively backs private equity and venture capital funds and also makes direct investments.
Ambar Sur, founder and CEO at TerraPay, said in the statement that the company will use the funds to grow its operations and build its payment infrastructure.
“We believe in our mission to address financial inclusion by making real-time national, regional and global payments accessible to everyone,” he added.
Comviva chief executive officer Manorajan Mohapatra said TerraPay’s divestiture was in the best interest of all the stakeholders involved. “We shall continue to take such strategic initiatives and leverage our startup factory for fuelling future growth,” he said.
TerraPay was advised by the financial technology-focused mergers and acquisitions team of investment bank Kempen & Co and Netherlands-based law firm Van Doorne.
Amsterdam-based TerraPay was founded in 2014 by Sur, who is also its CEO. The firm operates a business-to-business payments and remittances platform aimed at African markets.
Sur has handled various roles within Comviva, including as chief marketing officer and director for Europe, Middle East, and Africa.
He began his career in Washington as a project manager with LCC, a firm engaged in wireless voice and data services for the telecom industry, where he set up various networks around the world. Sur later moved to India to work with BPL Mobile, where he oversaw network performance and radio frequency planning for the company.
From BPL Mobile, Sur moved to BPL Innovision to establish OyeIndia, the group’s web technology company. In 2001, he co-founded CellCloud Technologies, a firm that merged with Mahindra Comviva in 2002. He graduated in electrical engineering from Virginia Tech in the US and holds a post-graduate degree in telecom from Brooklyn Polytechnic.
Comviva and Tech Mahindra
Comviva provides mobility solutions, including in the financial solutions segment with products such as mobile wallets systems, digital banking experience platforms and communication, and business solutions suites.
It is part of Tech Mahindra, the software services arm of the diversified Mahindra Group. In its 2018 annual report, it said it was aggressively setting up and buying platforms.
Last month, the company agreed to acquire US-based Zen3 Infosolutions (America) Inc. and its Indian unit for up to $64 million (Rs 460 crore) in cash. In November last year, Tech Mahindra had agreed to acquire Born Group Pte. Ltd and its Indian unit as part of efforts to enhance its consulting capabilities.
Before that, in July, Tech Mahindra had agreed to acquire a majority stake in US design consultancy Mad*Pow Media Solutions LLC. In June, the Indian software services company said it is acquiring Canada-headquartered IT consultancy Objectwise Consulting Group Inc.
