Ant Group Co. is considering selling some of its shares in the operator of Indian financial technology firm Paytm to keep its holding within a required threshold, according to people familiar with the matter. 

The Chinese fintech giant has been discussing options to reduce its stake in One 97 Communications Ltd. after its share percentage increased passively due to share buybacks, the people said, requesting not to be identified because the matter is private.

Talks are preliminary and details could change depending on regulatory and pricing concerns, the people added. Ant didn’t immediately respond to emailed requests for comment. Paytm declined to comment.

The deliberations follow Ant affiliate Alibaba Group Holding Ltd.’s sale of its stake in Paytm, as the e-commerce giant pared back investments in India amid growing geopolitical tensions. Ant’s sale would be for technical and not political reasons, the people added.

Ant held 24.86 per cent of One 97 as of December, but its holdings rose above 25 per cent after the repurchase reduced the number of shares outstanding, one of the people said. Ant has a 90-day window to cut its stake after the completion of the buyback on February 13, the person added. One 97 announced a buyback of as much as 8.5 billion rupees ($100 million) in December. 

Early talks

While Ant plans to pull back, Indian telecommunications tycoon Sunil Mittal is seeking a stake in Paytm by merging his financial services unit into the fintech giant’s payments bank, according to people with knowledge of the matter.

Mittal seeks to fold Airtel Payments Bank into Paytm Payments Bank in a stocks deal and is also seeking to buy Paytm shares from other holders, the people said, asking not to be identified discussing private information. Talks are in early stages and Airtel and Paytm may not reach a deal, the people added.

Ant has invested in 10 fintech wallets outside of mainland China, with the aim of building a network of payment services across Asia.

In China, Ant is awaiting a green light to apply for a financial holding company license that would ensure it can continue its fintech operations. In a sign of progress, regulators recently allowed the firm’s consumer lending affiliate to increase capital.

Billionaire Jack Ma, who has largely remained out of public sight, has said he will cede control of Ant amid a broader retreat, but still holds shares in the company.