PayU, a Dutch fintech firm owned by Naspers, has acquired majority stake in Singapore-based Red Dot Payment for $65m (£51.8m).
Established in 2011, Red Dot Payment offers innovative, secure and customised payment solutions to enterprises of all sizes across Asia and beyond. It focuses mainly on online retail, hospitality, charity, food delivery industries and more. The firm has expanded from Singapore and has offices in Indonesia and Thailand.
Through the transaction, PayU will expand its footprint in Southeast Asian (SEA) region and will have increased its total invested amount in fintechs to $700m (£558.7m) in the last three years.
As part of the deal, Red Dot Payment’s platforms will be integrated with PayU Hub. Furthermore, the acquisition will allow the Dutch fintech firm to offer more local alternate payment methods and connectivity.
Under the terms of the agreement, the founder will continue to retain a stake in Red Dot and majority of other shareholders will exit.
PayU CEO Laurent le Moal said: “This investment is PayU’s first step towards expansion in the SEA region. We will now provide our existing global merchants access to Southeast Asia with a single API integration, thus strengthening our global PayU Hub platform.
“Owing to the immense potential that the SEA market presents, PayU sees a vast opportunity in this region to grow and innovate further. We will continue to look for prospects to reinforce our footprints in this market.”
The Dutch payments company has quoted Google-Temasek study and said that Southeast Asia is one of the fastest growing digital payments markets in the world could triple in size to $240bn (£191.6bn) in total payments volume by 2025.
The region is claimed to have an active 350 million internet users spread in six largest countries and has immense business potential for global merchants.
Red Dot Payment CEO and founder Randy Tan said: “We are proud of how far we have come and that PayU, a leading global fintech operator and investor, recognises the strength, depth, and breadth of the company that we have built with unwavering dedication over the past eight years.
“It has never been easy for global merchants to enter Southeast Asia as they benefit from RDP’s strong local connectivity combined with PayU’s global footprints and experience.
“We are pleased that RDP will be part of the Naspers’ fintech portfolio as we look forward to continued extension of our business and market position in Southeast Asia to be the fintech payment solutions champion in this region.”