INSUBCONTINENT EXCLUSIVE:
Buffett's Berkshire Hathaway has a penchant for financial services.Berkshire Hathaway Inc
bought a stake in the company behind Paytm, India's biggest digital-payments brand, in the conglomerate's first foray into the country's
startups.Berkshire is set to acquire 3 percent to 4 percent of One97 in a deal that values the target at more than $10 billion, the people
said, asking not to be identified because the discussions are private
Warren Buffett, Berkshire's chairman and chief executive officer, wasn't directly involved in the investment in One97 Communications Ltd.,
his assistant, Debbie Bosanek, said Monday in an email
Bosanek declined to comment on the size of the investment.One97, founded by billionaire Vijay Shekhar Sharma, runs the Paytm brand and is
the leading player in India's booming digital-payments market
Berkshire joins a high-profile group that's invested in Sharma's companies, including Masayoshi Son's SoftBank Group Corp
and Jack Ma's Alibaba Group Holding Ltd
and Ant Financial."It's a paradigm shift," said Dinesh Arora, a PricewaterhouseCoopers LLP partner in India
"Financial services reach only the top 10 to 20 percent of India, but technology has the potential of adding a big slice of India's 1.3
billion people and bringing savings, credit and investments to their smartphones."One97 declined to comment
Mint reported on talks for a deal earlier Monday.Sharma got a huge boost in 2016 after India's government moved to eliminate most of the
nation's paper money in circulation in a bid to curb corruption
His fledgling startup, a pioneer in the country's nascent field, saw tens of millions of consumers and hundreds of thousands of businesses
sign up for digital services in a matter of months."Overnight, we went from a new thing to a must-have," Sharma said in a 2016 profile.He's
ridden that momentum to prominence in India's technology field
India's digital-payments industry is forecast to reach $1 trillion by 2023, from about $200 billion now, according to Credit Suisse Group
AG.One97 owns 49 percent of Paytm Payments Bank, which leads India's digital-payments market
Online retailer Paytm Ecommerce Pvt, also founded by Sharma, shares the brand name with One97 and runs the online retail platform Paytm
Mall, selling everything from smartphones to fashion.Buffett, who turns 88 this week, long focused on value investing and shied away from
technology companies because of what he joked were his own "intellectual shortcomings" in understanding the field
But he has adapted in recent years and piled into newer holdings such as Apple Inc
He considered an investment in Uber earlier this year.Buffett's Berkshire Hathaway has a penchant for financial services and disclosed in
August that he had boosted his stake in Goldman Sachs Group Inc
He also has sizable investments in American Express Co., Wells Fargo Co
and Bank of America Corp."Fintech is exciting because it dramatically brings down the cost of servicing customers, connecting people even in
the remotest parts of India and providing them the same level of customer service as someone sitting in Mumbai," Arora said.The Berkshire
investment comes as some critics question whether India's startup scene has become overheated, with several recent multibillion-dollar
investments boosting the value of such companies.(Except for the headline, this story has not been edited by TheIndianSubcontinent staff and
is published from a syndicated feed.)
