All You Need To Know About The Zomato-Blinkit Deal
The Zomato-Blinkit deal has been in the news since last couple of days. Curious to know whether its a loan, merger, or both? Here's all you need to know.
The past couple of days have been witness to lots of reports surrounding a potential deal between Zomato and Blinkit (formerly Grofers). While some reports are indicating a merger, Zomato¡¯s regulatory filing two days back states that it has extended a loan of $150 million to Grofers India Pvt. Ltd (GIPL).
Merger Deal, Loan Or Both?
Outlook
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According to a Business Standard report including information from sources aware of the development, what is under discussion is a share-swap deal in which Blinkit would be valued at around $750-800 million. Shareholders and investors of Blinkit will get around 10% in Zomato. SoftBank, which has a 40% stake in Blinkit, will get around 4-4.5% shareholding in the merged entity.
In its BSE regulatory filing, Zomato has reportedly stated that the company has extended a loan at an interest of 12% or higher with a tenure of not more than 1 year, and will be given in one or more tranches.
As per a report in TelegraphIndia, Zomato stated ¡°This loan will support the capital requirements of GIPL in the near term and is in line with our stated intent of investing up to $400 million cash in quick commerce in India over the next two years.¡±
The company was however, silent on reports of an all-stock merger with Blinkit at a valuation of at least $700 million.
Acquisition Of Food Robotics Company
The board of Zomato also reportedly approved the acquisition of 16.6% equity in Mukunda Foods for a consideration of $5 million, as per Business Standard.
¡°Our investment will help Mukunda Foods scale faster, help reduce restaurant food prices, expand margins, and enhance customer delight¡±, Zomato said.
Mukunda is a food robotics company that designs and manufactures smart robotic equipment to automate food preparation for restaurants. Their products enable restaurants to scale rapidly while maintaining consistency in food quality and customer experience across multiple outlets.
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