Naspers-owned FinTech PayU is pushing into Southeast Asia with a deal to acquire a majority stake in Singapore-based Red Dot Payment. Naspers specializes in developing markets in India, Latin America, Africa and Eastern Europe already — but is now officially adding Southeast Asia and its 600 million consumers to its line-up.
Red Dot is eight years old and offers services including a payment gateway, eCommerce storefronts and online invoicing. The deal with PayU values the firm at $65 million — though what the size of PayU’s majority stake is remains unspecified at this point. PayU said it has acquired “a majority stake” in the business.
“We have to strike the balance between a solid majority [acquisition] and an opportunity” for founders, PayU CEO Laurent le Moal told reporters in an interview.
PayU has also disclosed intentions to put “real investment” into the startup, while at the same time integrating its services into its tech and services Hub — a stack that is shared with its host of global business partners. The Hub itself is a product of an acquisition — specifically of Israel’s Zooz. PayU’s India business alone is estimated to be worth $2.5 billion.
Back to the deal, Randy Tan, CEO and founder of Red Dot Payment, called it “a marriage made in heaven” and noted that Red Dot had already turned down some deals from some very marquee players.
“They [PayU] operate globally and have over 300,000 merchants, including Facebook, Google and the kind of clients we aspire to win,” Tan noted.
The move, according to le Moal, allows PayU to get another step closer to its main goal when it comes to developing markets.
“We want to build the number one payments company for high-growth markets,” le Moal said. “If you look at what the top 10 economies will be in 2030, half are in Southeast Asia and the rest are growth markets we are already in,” he noted. He went on that PayU is number one in India, the largest African markets and in the top-growing parts of Europe and Latin America.
“It’s fundamental… you want to go where the consumer growth is,” he said.