Last Updated on June 27, 2022 by Anu Joy
The purchase of quick-commerce startup Blinkit by Zomato for ₹4,447 crores ($567 million) in an all-stock transaction has been authorized by Zomato’s board. Zomato will purchase 33,018 equity shares of Blink Commerce Pvt Ltd (BCPL) as part of the agreement at the predetermined preferential allotment price of ₹70.76 per share.
The acquisition will be carried out by diluting 629 million Zomato shares. Additionally, Zomato will pay ₹62 crores (approximately $8 million) in cash to acquire Hands on Trade Pvt Ltd (HOTPL), Blinkit’s warehousing company. However, the food aggregator won’t buy out their B2B trading operation. The transaction is anticipated to be completed by August 2022, pending shareholder and regulatory clearance.
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Get the latest technology news, reviews, and opinions on tech products right into your inbox“We are proposing to acquire Blinkit, a quick commerce business in India and where we first invested in August last year,” Zomato CEO Deepinder Goyal wrote in a company blog post. He further added, “This foray into the next big category is timely as our existing food business is steadily growing towards profitability – Zomato has grown at a CAGR of 86% in the last 4 years to an adjusted revenue of INR 55.4 billion ($710 million) while the adjusted EBITDA margin has improved from (153%) in FY19 to (18%) in FY22.”
Following this transaction, the company will maintain Zomato and the Blinkit app independently. To facilitate interoperability between the two apps, the company plans to “experiment with various ideas.” Blinkit will still be run by the old management including Albinder Dhindsa as the CEO.
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