comscore Zomato to acquire Blinkit for $578 million: Check details
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Zomato to acquire Blinkit for $578 million: Check details here

The Zomato CEO is a Q&A page said that the company would keep the Blinkit app and Zomato separate. However, the company will work on features that offer interoperability between the two apps.

Zomato

Image: Zomato


Zomato’s board has approved the acquisition of quick-commerce company Blinkit for Rs 4,447 crore ($567 million) in an all-stock deal. As a part of the deal, Zomato will acquire 33,018 equity shares of Blink Commerce Pvt Ltd (BCPL) at a prescribed preferential allotment price of Rs 70.76 per share. The transaction will be carried out by issuing around 629 million Zomato shares on a fully diluted basis. Also Read - Delhi govt mandates cab aggregators, food delivery services to have all-electric vehicle fleet by April 2030

In addition to acquiring Blinkit’s commerce business, Zomato will also be acquiring its warehousing business, Hands on Trade Pvt Ltd (HOTPL), for Rs 607 million ($8 million approximately) in cash. However, the food-aggregator will not be acquiring Blinkit’s B2B trading business, it said. Also Read - Government asks Swiggy, Zomato to submit proposal for better consumer grievance redressal within 15 days

The deal is expected to close in August 2022 subject to regulatory approval and nod by the shareholders. Also Read - After Zomato, Ola pilots 10-minute food delivery service in India; Swiggy in line too

“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 post.

“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,” he added.

What happens to Blinkit after acquisition?

As far as what will happen to the Blinkit once the deal is confirmed is concerned, the Zomato CEO is a Q&A page said that the company would keep the Blinkit app and Zomato separate. “Zomato brand stands for everything ‘food’ in customers’ minds, while Blinkit is on the path to becoming a brand that customers associate with grocery and essential supplies,” he wrote.

However, the company will ‘experiment with various ideas’ that would enable interoperability between the two apps. “We will explore ways in which Blinkit can benefit from Zomato’s large customer base (and vice versa in the long term). Post the deal closure, we are going to start experimenting with various ideas that we have and see which all bear fruit, including having the Blinkit tab on the Zomato app,” he said adding that Blinkit’s team led by the CEO Albinder Dhindsa will continue to run the business.

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  • Published Date: June 25, 2022 11:29 AM IST



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