Axis Bank is all set to have its third meeting with Freecharge on Friday with to conclude acquisition talks. Axis Bank has emerged as the front runner and has placed an initial bid of $20 million (Rs 128 crore), for acquiring Freecharge, the mobile wallet company owned by Snapdeal, which once competed intensely with Paytm.
Axis Bank which has conducted its financial and commercial due diligence as part of its valuation exercise has also come out with its packages for the employees of Freecharge, sources familiar with the developments told FE. The CEO, COO and chief product officer of Freecharge will get Rs 2 crore each and another Rs 12 crore will be reserved for the remaining 250 odd employees of the company.
According to sources, the monthly salary bill at Freecharge is around Rs 5 crore and this is despite the company reducing its headcount by over 50%. The monthly burn rate of the company is estimated to be around Rs 8-9 crore, sources said.
E-mails sent by FE to Axis Bank and Freecharge seeking their responses on these developments remained unanswered till the time of going to the press. Axis Bank’s bid is distinctly lower than the $400 million paid by Snapdeal to acquire Freecharge in 2015. Sources indicated that Freecharge has been legally separated from Snapdeal but there is no clarity on who will be the beneficiaries if the sale with Axis Bank goes through. It is understood that Axis Bank is only interested in Freecharge’s technology platform.