The deal allows the global fintech company expands its reach to Southeast Asia, where it hopes to gain a slice of the region's growing digital payments market.
Netherlands-headquartered fintech firm PayU has acquired a majority stake in Singapore online payments company Red Dot Payments in a transaction valuing the firm at $65 million, the firm announced on Friday in a press statement.
The deal allows PayU to broaden its reach to the lucrative Southeast Asian market and brings its total amount of fintech investments and M&A spending over $700 million in the past three years.
With the deal, Red Dot's founder and CEO, Randy Tan, will continue to retain a stake in the company, while the majority of other shareholders will exit, the statement added.
Digital Payments Market
The digital payments market in Southeast Asia – a market of 600 million people – is growing along with the region's wealth and rapidly growing internet access. The region already has $80 billion in total payments volume annually, a figure that is expected to triple in size to by 2025, according to data by Google and Temasek.
Red Dot Payments was founded in 2011 and is the country's largest homegrown payment solutions provider, with offices in Indonesia and Thailand. It has focused on verticals including online retail, hospitality, charity and food delivery. Its backers include Japan’s GMO, Wavemaker, Skype co-founder Toivo Annus and MDI Ventures.
PayU is the fintech and e-payments division of South Africa-based global consumer internet group Naspers, one of the largest technology investors in the world. PayU already operates in 18 markets across Asia, Central and Eastern Europe, Latin America, the Middle East and Africa.
