Amazon, a major player in e-commerce, looks to be just a few steps away from acquiring Emvantage, its first fintech company in India. According to two sources who spoke to the media, the company is in advanced talks to buy online lending platform Axio (formerly Capital Float).
This would make Amazon’s second acquisition of the year. In order to expand its Mini TV offerings in India, it had purchased the assets of MX Player in May.
“Amazon is set to buy Axio in a $150-175 million all cash deal,” said one of the sources requesting anonymity. “The terms of the deal have been finalized, and it’s (Amazon) currently conducting due-diligence.”
Amazon is currently an investor in Axio, having taken part in the company’s Rs 144 crore extended Series C round in 2018. About 8% of the lending platform based in Bengaluru is currently owned by the company.
It was highlighted by sources that Axio, backed by Ribbit Capital, would power buy now pay later (BNPL) for Amazon Pay.
“The acquisition makes absolute sense for both companies as they are over-dependent on each other. Over 80% of Axio’s volume comes from Amazon, while the e-commerce major’s BNPL is largely powered by Axio,” said another source.
Axio’s other partners are Decathlon and Xiaomi in addition to Amazon. On its website, the business states that it has given credit to nine million clients. For roughly $30 million in 2018, Elevation-backed Walnut was purchased by Axio.
According to sources, Amazon purchased Axio in 2018 for about $350 million. This basically indicates that investors and other stakeholders won’t be making a lot of money from the deal.
In FY23, Axio’s revenue reportedly increased by 2X to Rs 220 crore from Rs 110 crore in FY22, as reported by the media. Still, the company’s losses increased slightly during that same period (FY23) to Rs 137 crore. No FY24 numbers have been released yet.
