Food delivery app, Zomato may soon acquire the 10-minute delivery service, Blinkit in a share swap deal as per reports from several media outlets. Very recently, Zomato had loaned around $150 million to Blinkit alongside picking up a 10% stake, according to the ET.
The rumors of a possible merger-more of an accusation have been doing the rounds for quite some time. Â Formerly called Grofers, this startup has been struggling to raise funds. This year witnessed them closing many of their dark stores as well as scaling down operations.
Their decrease in valuation and losing the tag of a unicorn post pandemic has also led to the diminishing image of Blinkit. Blinkit was amongst the top 50 unicorns, previously valued at $1 Billion but the all-stock deal would be valued at a diminished value of about $700 – $800 million.
India’s market has currently seen a lot of competition amongst quick service startups like Instamart and Zepto. This geopolitical conflict along with a crash in the share price of Zomato and several other firms has made it even more difficult for Blinkit and its valuation.
Although both the companies have been fairly silent about this deal, Zomato’s takeover is expected to complete within the next two months. Softbank, which had a 40% stake in this quick commerce startup would get a 4-5% stake in Zomato as part of this deal, and Investors like Tiger Global and Sequoia capital would get additional shares in the entity.
Published By: Apoorva Wakodikar
Edited By: Subbuthai Padma
