7 Indian and 3 Foreign Law Firms help Paytm raise India’s largest IPO

Vijay Sharma’s One 97 Communications Limited filed its Draft Red Herring Prospectus before Securities Exchange Board of India (SEBI) for its record 16,600 crore IPO. This is the largest IPO in India, in terms of fund raise beating Coal India IPO in 2010.

After Zomato IPO witnessed a favourable fundraise, Paytm would be the second IPO this month for Chinese Investors Ant Group, an affiliate company of the Chinese Alibaba Group.

Coal India IPO that opened on October 18, 2010 mobilized Rs. 236,000 crore (US$52.4 billion), although the target was to raise only Rs. 15,500 crore (US$3.4 billion).

Read our 2010 Story on Coal India IPO - What were the Law Firm fees bid to get this Government Company IPO?

11 Law Firms have represented various stakeholders in the Paytm IPO.

Paytm was represented by the Delhi office of Shardul Amarchand Mangaldas, who was its India Counsel while Latham & Watkins (Singapore) were the International Counsels to Paytm. Pallavi Shroff, Managing Partner of Shardul Amarchand Mangaldas is also on the Board of Paytm as Independent Director.

Paytm and Amarchand Mangaldas relationship goes back to 2011 when Paytm raised one of its first funding from SAP Ventures.

Paytm over the last decade has consistently raised money from Private Equity companies. In 2015, AliBaba and its affiliate Ant Financial invested $680 million in Paytm and even there Shardul Amarchand and Trilegal were the lead counsels.

In 2017, Paytm received a $1.4 Billion investment from Softbank. Four law firms represented this massive deal valuing Paytm at $7 Billion. Raghubir Menon and Ekta Gupta have been lead partners in most of the Paytm private equity transactions.

Chinese Investors in Paytm, Alibaba and Antfin Holdings (a Dutch company belonging to Alibaba) were represented by Trilegal. Ant Fin is a Dutch company belonging to Alibaba. Most of Ant Financial Investments in India have been represented by Trilegal. Trilegal's Rohan Ghosh Roy has been the lead partner representing all Alibaba deals.

The lead managers to the IPO, were represented by Khaitan & Co and the Hong Kong office of Shearman and Sterling.

In other disclosures filed before SEBI, Paytm has said it spent nearly 78 crores in legal fees for year ending March 2021. In the past two years it spent similar fees (76.8 crores in 2020) while spending 93.8 crores in 2019.

Paytm has listed its litigation summary before SEBI.

Except for a tax related dispute involving 3,700 crores, most of the litigations are non significant.

The Office of Deputy Commissioner, Noida has issued a notice in December 2020 proposing to levy a tax demand of Rs. 1,780 crores and an interest and penalty of Rs.1,900 crores. It was alleged that due tax had not been paid under correct head and input tax credit had been wrongly claimed/availed and utilized by Paytm by making wilful-misstatements and supersession of facts for the Period.

If you would like your Deals, Columns, Press Releases to be published on Bar & Bench, please fill in the form available here.