Payments firm Pine Labs has received approval from a Singapore court to merge its India and Singapore entities, Pine Labs Limited (PLS) and Pine Labs Private Limited (PLI).
This move is aimed for Singapore-based Pine Labs, to move its domicile to India. Meanwhile, its application for a reverse merger is under consideration at the National Company Law Tribunal (NCLT).
The whole undertaking of Pine Labs Limited including all assets and liabilities shall be transferred and vested in PLI according to the amalgamation agreement, according to regulatory filing in Singapore.
All the shareholders of Singapore entity will become Pine Labs Private Limited (PLI) shareholders and any pending legal proceedings against PLS shall be continued by PLI after the arrangement.
The filing further states that following the National Company Law Tribunal (NCLT) order filed with the Registrar of Companies, the Singapore entity shall be dissolved without undergoing winding up.
Pine Labs has become the third fintech company after PhonePe and Groww which relocated its domicile to India from overseas. Currently, various start-ups including KreditBee, Razorpay, Meesho, and Zepto have been working on shifting their ultimate holding entities to India.
All companies are also trying to assess the tax payout–in India or abroad–for these mergers.
In April, US-based investment firms Baron Funds and Invesco marked up the valuation of Pine Labs to $5.8 billion and $4.8 billion, respectively. It’s worth noting that the valuation plays a crucial role in deciding the quantum of tax liabilities for shifting the domicile.
Of late, fintech companies have been laying emphasis to be headquartered in India as regulators’ job become easier as far as diligence and monitoring are concerned. However, the reverse flips require hefty tax liabilities. For context, PhonePe’s investors paid ₹8,000 crore in taxes to complete the process.
While PhonePe shifted its domicile to India in October 2022, wealth management startup Groww announced the completion of its move on May 9.