Zomato and Blinkit are expected to merge in a share swap deal
- ByStartupStory | March 15, 2022
According to various persons briefed on the matter, the online food delivery provider, Zomato is in talks to buy Blinkit (previously Grofers) in a share swap agreement. This comes after Zomato invested $100 million in Gurugram-based rapid commerce firm Blinkit last year, acquiring a 10% interest in the Albinder Dhindsa-led company.
Since Zomato’s investment in Blinkit, the merger has been predicted as a likely consequence. Sources briefed on the situation stated that while the details of the agreement are still being worked out, it is expected to be a 10:1 ratio, valuing Blinkit at roughly $700-800 million based on Zomato’s current market capitalization. This is less than the previous valuation of Blinkit, which was a little over $1 billion.
Blinkit’s largest investor, SoftBank Vision Fund, as well as existing Zomato investors Tiger Global, will get a stake in the meal delivery company as a result of the share swap arrangement.
Surprisingly, SoftBank made a big bet on Swiggy last year, investing $450 million in the Bengaluru-based food-delivery service. As part of the arrangement, the Japanese company is anticipated to acquire a 4-5 per cent interest in Zomato.
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