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Ant Financial delivers $150 mn to Zomato at $3 bn valuation
Photo Credit: VCCircle

Food delivery company Zomato Media Pvt. Ltd has raised $150 million (Rs 1,067 crore) from existing investor Ant Financial, the payments affiliate of Chinese e-commerce conglomerate Alibaba Group Holding Ltd.

Zomato is raising the primary capital at a pre-money valuation of $3 billion, according to a stock-exchange filing by another investor Info Edge (India) Ltd.

Info Edge said its own stake in Zomato will fall to 25.13% when this fundraise is completed. It didn’t give any other details.

Zomato had last raised funding about a year ago, mopping up about $62 million from investors including Berlin-based Delivery Hero and China’s Shunwei Capital.

Reports in October had suggested that Ant Financial’s investment was part of a larger $600 million fundraising round by Zomato, with the Alibaba affiliate contributing around $200 million. The remaining was expected to be committed by others including Singapore state investor Temasek and other hedge funds.

The reports said that the investment would turn Ant Financial into Zomato’s largest shareholder, with a stake of 29%. Other investors in the food-technology company include Sequoia Capital India, Nexus Ventures, Blume Ventures, Matrix Partners India and DST Global.

Gurugram-based Zomato reported consolidated net sales of Rs 332.27 crore, Rs 466.36 crore, and Rs 1,312.58 crore for the 2017, 2018 and 2019 financial years, according to VCCEdge, the data research arm of Mosaic Digital.

Zomato, which makes its money through advertising, online ordering and subscription services, was founded in 2008. It operates in over 60 cities in India and also has a presence in 20 other countries. In July last year, it acquired a non-profit food donation startup Feeding India, which allows people to donate food for charity.

Zomato had last raised funding about a year ago, mopping up about $62 million from investors including Berlin-based Delivery Hero and China’s Shunwei Capital. Prior to that, it raised Rs 284.42 crore (around $39.7 million) from the US-based Glade Brook Capital, which provides growth capital to technology companies worldwide.

In India, Zomato competes with firms such as Swiggy, UberEats, and FoodPanda. Reports last month suggested that Zomato was in advanced talks to buy the Uber-operated UberEats, with the latter’s parent infusing fresh capital of up to $200 million (around Rs 1,419 crore) in the combined company.

Earlier this year, UberEats came close to selling its India business to Swiggy but talks fell through on tax implications and other terms that weren’t agreeable to both parties. UberEats will help Zomato gain access to the southern Indian market where the company has not been able to make inroads unlike the north, which is its stronghold.
 

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