India’s Zomato nabs $150m from China’s Ant Financial at $3b valuation

Photo: Mint

Food ordering and delivery platform Zomato Media Pvt Ltd has entered into an agreement to raise up to $150 million from existing investor Ant Financial.

The Gurugram-based company is raising the primary capital at a pre-money valuation of $3 billion, its other investor Info Edge (India) Ltd said in a BSE filing on Friday. Upon closing of this financing, Info Edge’s shareholding in Zomato will reduce to about 25.13 per cent on a fully converted and diluted basis, it added.

Zomato has been in talks with Ant Financial and Singapore state investment firm Temasek to raise a larger round of $600 million. The funding at this point in time was imperative to help Zomato stay in the game and fend off competitor Swiggy.

Zomato was valued at about $2 billion when it last raised funding. The company concluded raising about $315 million as past of its Series J funding in March last year with participation from Delivery Hero and Glade Brook Capital.

Ant Financial had contributed $210 million in the first tranche of Series J in October 2018. The transaction saw Info Edge’s shareholding in Zomato come down to about 27.68 per cent on a fully converted and diluted basis from 30.91 per cent. The Chinese investor had also pumped in $200 million in Zomato’s Series I round in February 2018. Zomato also counts Sequoia Capital india, Temasek Holdings, and Vy Capital among its list of backers.

With the Indian online food delivery market estimated to touch $12.53 billion by 2023, both Zomato and Swiggy are increasing spends to grab a larger share.

Last year, Zomato suspended its Infinity Dining programme, which allowed subscribers to order unlimited food and beverages at a set price from the menu of partner restaurants for a limited period of time. The suspension followed protests from partner restaurants against the deep and unsustainable discounting.

The company also laid off around 541 employees across its customer support team in Gurugram last year, stating improvement in technology in areas such as after-sales support and other customer support-related functions.

Meanwhile, Swiggy has expanded its offerings beyond food delivery with Swiggy Stores and Swiggy Go. The company is also looking to enter the Indian digital payments space to cash in on its fast-growing customer base and high repeat usage.

Swiggy is also in advanced stages of closing a $700-750-million round that is slated to be led by existing investor Naspers.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.