Jio Financial Services (JFSL) has firmly refuted reports suggesting its involvement in discussions to acquire Paytm's wallet business. In a regulatory filing, JFSL categorically stated, "We clarify that the news item is speculative, and we have not been in any negotiations in this regard." The statement aims to dispel any uncertainties arising from the earlier reports that fueled market speculation.
In response to the initial report, which indicated talks between JFSL and Paytm's parent company One97 for the acquisition of the wallet business, JFSL experienced a notable surge in its stock value. The non-banking financial company (NBFC), demerged from its parent entity, Reliance Industries Limited (RIL), and listed on stock exchanges last year, witnessed a 14% increase in its shares, closing at Rs 289 on the Bombay Stock Exchange (BSE).
Mukesh Ambani-led JFSL swiftly addressed the situation, issuing a statement emphasizing its commitment to regulatory compliance and transparency in disclosures. The company stated, "We have always made and will continue to make disclosures in compliance with our obligations." Simultaneously, Paytm has also been called upon to provide clarification regarding the reported discussions.
The developments have had a substantial impact on Paytm's market performance, with its shares witnessing a sharp decline of 42% over a mere three days. This downturn has resulted in the erosion of Rs 20,500 crore worth of investor wealth, with Paytm's stock reaching an all-time low at Rs 438.35 on BSE at the conclusion of Monday's trading session.
Furthermore, reports suggest that the Reserve Bank of India (RBI) is contemplating the cancellation of Paytm's banking license. Alleged concerns surrounding potential money laundering and violations of know-your-customer (KYC) regulations are believed to be the basis for this regulatory scrutiny. The unfolding situation underscores the challenges and uncertainties currently surrounding Paytm and its impact on both investors and regulatory bodies
