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PayU buys Citrus Pay for $130 million; CEO Nitin Gupta to step down

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Naspers-backed PayU has acquired payments company Citrus Pay for $130 million in an all cash deal, CEO Nitin Gupta confirmed to MediaNama. Following the deal, Gupta said that he would be stepping down from his role as CEO and pursue another venture. Meanwhile, Citrus Pay’s managing director Amrish Rau would take over the reins of the combined entity as CEO, he told.

Citrus’s other co-founder, Jitendra Gupta, and PayU’s Shailaz Nag would be taking leadership positions in the company. The Economic Times points out that Jitendra Gupta would be developing its credit underwriting business through Citrus’ Lazy Pay unit. 

Both PayU and Citrus have been ramping up their product portfolios in recent times:

– Last month, PayU got a semi-closed wallet licence from the Reserve Bank of India for their PayU money wallet (it had been running the wallet with a licence from RBL Bank earlier).
– In June, PayU also launched its POS terminal. Last month it said that it has more than 5,000 terminals and is adding 1,350 machines by the end of the month.
– PayU also got a licence to setup a Bharat Bill Payments Operating Unit (BBPOU).  The approval from the RBI will allow BBPOUs to connect with the central bill payments and settlement system called Bharat Bill Payment System (BBPS).
– In July, Citrus Pay launched Sellfie for contextual payments. Users can now sell and collect payments directly on social media sites, messengers and other online channels through this app.
– Citrus Pay also has Lazy Pay and which will allow the company to become an underwriter of transactions and charge consumers, on a fortnightly basis.

Funding

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In October 2015, Citrus raised Series C funding led by Ascent Capital and existing investor, Sequoia Capital, with participation from other existing investors, Beenos and eContext Asia. An ET report pegs the Cirtrus funding at $25 million, though there is no confirmation from the company on the amount raised.

The Economic Times report added that Sequoia Capital owns 32% of the company and is expected to make a four-fold return on its $10 million investment. Ascent Capital which owns 8% of the shares is expected to make about $12 million.

In December 2013, the company had raised $5.5 million in Series B funding from the Japanese online payments service provider econtext Asia and Netprice.com’s wholly owned subsidiary Beenos Asia with participation from existing investor Sequoia Capital. Earlier that year, Citrus had raised $2 million from Sequoia Capital, while in 2012, it raised an undisclosed amount in seed funding from Sequoia Capital.

Cube hived off as separate entity

In December 2015, Citrus hived off its mobile app Cube as a separate entity with co-founder Satyen Kothari heading the new startup. Cube is 100% owned by Kothari and completely independent from Citrus. At the time the company said  Kothari would continue to have a stake in Citrus Payments and will function as a non-executive director.

Also read: It looks like PayU is buying Citrus Pay to take on PayPal

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