Zomato’s board of directors approved the acquisition of an online grocery store flashes (Previously Grofers) in an all-stock transaction at a board meeting, according to an ESB filing. The long-awaited agreement will help Zomato, which has been bullish on fast trade, significantly strengthens its position in the bustling and super-fast grocery delivery industry. Here’s all about the deal
What is the value of the case
The deal is valued at Rs 4,447 crore or nearly $570 million. It’s nearly 43% below Blinkit’s last valuation of just over $1 billion. Blinkit became a unicorn in 2021 with $120 million in funding from Zomato and world tiger.
What does the BSE dossier say
In the BSE filing, Zomato said its board approved the acquisition of up to 33,018 shares of Blink Commerce Private Limitedformerly known as Grofers India Private Limited for a total purchase consideration of Rs 4447,47,84,078 at a price of Rs 13,46,986.01 per share by issuance and allotment of up to 62,85,30,012 fully paid shares of the company having a par value of Rs 1 each.
How the business started
Zomato entered into talks to acquire Blinkit, then Grofers, in April 2020. In June 2021, Grofers raises 120 million from Zomato and Tiger Global to become a unicorn.
Founder of Zomato and CEO Deepinder Goyalletter to shareholders
In a letter to shareholders, Zomato Founder and CEO, Deepinder Goyal said, “Rapid commerce has been our stated strategic priority since last year. We have seen this industry grow rapidly in India and globally as customers have found great value in the fast delivery business of groceries and other essentials.This business also synergizes with our core food business, giving Zomato the right to win in the long run. ” He added: “This foray into the next big category is timely as our existing food business is steadily progressing towards profitability.”
What about Zomato and Blinkit apps
Goyal said the Blinkit and Zomato apps will continue to exist separately.
(With agency contributions)