Zomato grabs $210 Mn from Alipay, Ant Financial gains majority stake

Shubham Kumar Shubham Kumar
Oct 16, 2018 1 min read
Zomato grabs $210 Mn from Alipay, Ant Financial gains majority stake

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Chinese e-tailing behemoth, Alibaba is aggressively vying to expand its presence across India’s foodtech space after capital infusion into the foodtech unicorn – Zomato. The home-grown foodtech major has signed a definitive agreement with Alibaba-owned digital financial service platform - Alipay Singapore Pte Ltd. to undertake a primary fundraise of around $210 million. Following the latest agreement, Alibaba's payment affiliate Ant Financial invested in the food delivery platform.

Post fund infusion from Alipay this week, the company’s earliest backer - Info Edge’s share-holding reduced from 30.91% to 27.68% on a fully converted and diluted basis and is no longer its largest shareholder. Alibaba’s stake in it is expected to soar over 28 per cent. Before the deal went through, Ant Financial held 20% stake in the foodtech firm. In September, Ant Financial procured the rights to become the largest shareholder of the Gurugram-based firm.

Alipay, the existing investor of Zomato, has infused $150 million as primary capital in the foodtech firm earlier this year. According to reports, Zomato has generated revenues of $74 million in the FY18 without divulging the profit or loss incurred.

Last month, zomato acquired Bengaluru-based startup – TongueStun in a cash and stock deal for $18 million. Last year, Zomato acquired logistic startup Runnr, to enhance its delivery capabilities.

Swiggy and Zomato, the foodtech majors are in a fierce battle with Chinese giants backing up both. Its primary competitor, Swiggy is reportedly in talks with Alibaba’s rival and WeChat app owner Tencent to scale up and strengthen its operations with a $500-700 million deal. Other competitors who have made foray into this space are - Ola acquired Foodpanda, and Uber’s food delivery arm, UberEats.

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