PwC India resigns as auditor of Paytm Payments Services Ltd

One 97 Communications Limited, which owns Paytm, on Monday informed that its subsidiary Paytm Payments Services Limited's (PPSL) auditor Price Waterhouse (PwC) has resigned with effect from August 7. SR Batliboi & Associates has been appointed as the statutory auditors of Paytm Payments Services' with effect from August 7, the company said in an exchange filing. 

In its resignation letter dated August 7, PwC said that there has been a change of auditors at the holding company level. Consequently, it said, keeping in mind the company's understandable practice to align the auditor of Paytm Payments Services with the auditor of the holding company in order to bring in synergies and maintain consistency in the audit process of the group, "we hereby tender our resignation as the statutory auditors of PPSL".

PwC further said that it has issued an audit report dated May 2, 2023 on the financial statements for the year ended March 31, 2023. The firm said its limited review report dated July 19, 2023 on the unaudited special purpose interim condensed financial statements for the quarter ended June 30, 2023.

Earlier in March, Paytm had informed that it will propose SRB as the new auditors after the completion of the five-year term of their current statutory auditors PwC to its shareholders for approval in the upcoming AGM. Under Section 139 (2) of the Companies Act, 2013, a listed company is recommended to rotate auditors after the completion of a term of five years. 

Meanwhile, Paytm founder and CEO Vijay Shekhar Sharma has entered into an agreement to purchase 10.30 per cent stake in Paytm from Antfin (Netherlands) Holdings BV through an off-market transfer in a no-cash deal. The deal turns One97 Communications into a majorly Indian-owned company from being majorly owned by Chinese entities. 

Antfin will continue to hold the economic rights of the stake that is being transferred to Sharma. As per the deal, Sharma will purchase 10.3 per cent shareholding in Paytm from Antfin through his 100 per cent owned overseas entity Resilient Asset Management BV which will make him the largest shareholder in the company with a total stake of 19.42 per cent. 

Sharma held a little over 9 per cent stake in Paytm before the deal. Resilient Asset in return will issue debt instrument OCDs (optionally convertible debentures) to Antfin. "Accordingly, no cash payment will be made for this acquisition, and neither will any pledge, guarantee, or other value assurance be provided by Sharma, directly or otherwise," a BSE filing said.