One97 Communications' 4.5 percent share from SoftBank is being sold.
A block transaction will be used to complete the sale.
Shares of Paytm dropped by 70% from their IPO price.

Following a report that SoftBank will sell shares in the Indian e-payment platform worth up to $215 million (roughly Rs. 1,755 crore), the parent company of Paytm One 97 Communications saw its shares drop as much as 10% to their lowest level since May.

A term sheet states that SoftBank will sell a 4.5 percent stake in One 97 Communications, the parent company of Indian e-payments giant Paytm, in a block deal for up to $215 million. Paytm's shares have dropped more than 60% since it went public a year ago, and SoftBank's Vision Fund is the second-largest shareholder. At the end of September, SoftBank owned a 17.5 percent stake in the fintech and digital payments business.

The term sheet stated that the stock is being sold in a price range of Rs. 555 to Rs. 601.45 per share, with the lower end of the range providing a 7.7 percent discount to the company's most recent closing price.

Later on Thursday, the final cost will be decided. The sale is the most recent in a series of divestitures SoftBank has made in recent months as a result of losses recorded by its flagship Vision Fund business of about $50 billion (approximately Rs. 4,08,150 crore) in just six months.

According to a person with firsthand knowledge of the situation, hedge funds including Norges Bank, the central bank of Norway, Millennium Capital, Segantii Capital Management, and Ghisallo Capital Management are among the other buyers of the shares. Because the information was still private, the person asked to remain anonymous. Requests for response from Norges Bank, Paytm, Millennium, Segantii, SoftBank, and Paytm were not answered.

According to the term sheet, Bank of America is the deal's lead broker and SoftBank is selling 29 million shares. A day after the end of the lock-in period for investors in Paytm's November 2021 initial public offering, the news was released.

Thursday's opening price for the company's shares was Rs. 546.05, which was a 9 percent decline from the previous close. A few months ago, SoftBank sold shares in T-Mobile US to raise $2.4 billion (or roughly Rs. 19,600 crore).