India’s Zomato set to raise $146m in final funding push before IPO

Zomato Summit in India. Photo: Zomato

Food tech unicorn Zomato, which is gearing up for a public listing in the first-half of 2021, is set to raise a little over $146.5 million as part of its ongoing Series J round of funding, in a final funding push before it starts preparation for an Initial Public Offering (IPO).

The Gurugram-based food tech major has already raised another 37.9 crores (or $5.1 million) from Pacific Horizon Investment Trust, which is managed by UK-based Baillie Gifford & Co. Ltd., regulatory filings sourced from business intelligence platform Tofler showed.

In March, Pacific Horizon Investment Trust had pumped in $5 million in the food tech major.

Zomato’s ongoing round will see the likes of Mirae Asset-Naver Asia Growth Fund, Steadview Capital, hedge-fund Luxor Capital Partners, Lugard Road Capital and ASP India LP pump in additional capital, in the coming weeks.

Zomato is looking to issue 34,873 Class J7 Compulsorily Convertible Cumulative Preference Shares (CCPS) to the above-quoted investors, at an expected issue price of 3,00,235 per share, garnering close to 1047 crores (or $141 million) in funding, regulatory documents show.

In a bid to bolster its cash reserves, the foodtech unicorn has been on a fundraising spree, over the past months, cornering a little more than $270 million in investments, alone this year, from key investors – Tiger Global Management; Temasek, through MacRitchie Investments, Ant Financial and others.

The development of Zomato’s recent fundraise was first reported by news portal Entrackr.

Mint reported on Thursday that Zomato has appointed Kotak Mahindra Bank as merchant banker and Cyril Amarchand Mangaldas and Indus Law as legal advisors.

If the startup pulls off the IPO, it will join the likes of MakeMyTrip, which listed on NASDAQ in 2010, and Zomato’s single-largest shareholder Info Edge India Ltd, which was listed on BSE in 2006.

In October, Zomato made changes to its leadership team, elevating Akshant Goyal as chief financial officer (CFO), as it continues to give its employees exits through secondary share sale transactions. Akriti Chopra, who was earlier CFO and led fundraising will now be responsible for people development for the organisation.

Zomato currently holds a valuation of $3.3 billion, as per its last funding round from Kora Investments, in October, which infused close to $52 million in the startup.

As Zomato looks to go public, losses for the firm haven’t seen any significant improvement. Although Zomato doubled its revenue to $394 million in 2019-20, losses also marginally increased to $293 million from $277 million in 2018-19.

Analysts however said the losses wouldn’t impact Zomato’s IPO aspirations.

The article was first published on livemint.com.

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.