Zomato Acquires Blinkit For Rs 44.47 Billion To Beef Up Quick Delivery Game

Zomato To Hike Stake In Blinkit: What’s The News?Also Read – Swiggy, Zomato Asked to Furnish Grievance Resolution Framework Within 15 Days After Over 3000 Consumer Complaints

Bengaluru: In an all-stock deal, food-delivery firm Zomato Ltd is set to buy local grocery-delivery startup Blinkit for Rs 44.47 billion ($568.16 million) in an all-stock deal. Also Read – Delivery Boy Who Worked at Ola & Zomato Becomes A Software Engineer, Leaves Netizens Inspired

Why The Deal Matters?

• The move is set to step up Ant Group-backed Zomato’s game, as competition in the quick-delivery market gets fierce.
• Zomato’s market rivals Swiggy, Reliance Industries-backed Dunzo, Tata-backed BigBasket and Zepto are also betting on fast deliveries in the quick commerce sector.
• The quick commerce sector was worth $300 million last year and is expected to grow 10-15 times to $5 billion by 2025, according to research firm RedSeer.

What We Know So Far About The Deal (In Points)

• Formerly known as Grofers, SoftBank Group-backed Blinkit rebranded itself late last year as its chief promised to speed up deliveries of everything from groceries to electronics in a burgeoning market dominated by Flipkart and Amazon.
• Blinkit, a struggling 10-minute grocery delivery startup, which operates in over 20 Indian cities, delivers products ranging from milk, fruits and vegetables to electronics.
• Last year in August, Zomato bought a more than 9% stake in Blinkit for nearly 5.18 billion rupees ($66.16 million).
• The food-delivery firm earlier this year said it would invest as much as $400 million in the Indian quick commerce market over the next two years.
• As per Zomato’s letter to shareholders on Friday, Blinkit’s gross order value in May stood at Rs 4.03 billion rupees. Zomato did not divulge details on the size of the latest stake.
• Zomato has reported a wider loss for the March-quarter compared to a year earlier, but said average monthly transacting customers were at an all time high of 15.7 million in the fourth quarter, up from 15.3 million in the previous quarter, according to a report by news agency Reuters.
• Zomato said it would also buy the warehousing and ancillary services business from Blinkit’s parent company Grofers International for up to Rs 607 million.

Recap: Zomato has acquired Blinkit in a Rs 44.47 billion all-stock deal as the loss-making food delivery firm looks to broaden its offerings at a time when its shares are trading far below last year’s debut price and less than half of the all-time highs. Also Read – Firing Season At Indian Startups? Over 6,000 Layoffs This Year Leave Workforce Enraged