Food delivery player Zomato may take control of Blinkit (erstwhile Grofers) after the food aggregator extended a $150 million emergency loan facility to the quick commerce startup, a Mint report said, quoting two people familiar with the deal.
The transaction involves an all-stock deal that values Blinkit between $700 million and $800 million. The deal value is significantly lower than the unicorn status Blinkit achieved after getting more than $120 million from Zomato and investor Tiger Global Management, the report further said.
Zomato owns about 10 percent of Blinkit which is run by Grofers India Pvt. Ltd.
In a post-market regulatory filing on BSE on March 15, Zomato said it will "grant a loan of up to $150 million to Grofers India in one or more tranches. This loan will support the capital requirements of Grofers 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 2 years." The regulatory filing, however, did not say if Zomato is going to take over Blinkit.
Additionally, the company said in the regulatory filing that it had acquired a 16.66 percent stake in Mukunda Foods Private Limited for $5 million. Mukunda Foods deals in food robotics and automation, which manufactures and designs 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. Mukunda also helps restaurants to become more efficient by reducing manpower cost, wastage and increasing kitchen throughput. Our investment will help Mukunda Foods scale faster, help reduce restaurant food prices, expand margins, and enhance customer delight," Zomato said.
Shares of Zomato hit their all-time low of ₹75.55 in early trades on BSE but soon recovered and traded with mild gains. The stock is now 55 percent below its all-time high of ₹169.10 on BSE.
Shares of the new-age tech companies such as Zomato and Paytm have been under pressure of late amid market volatility.
Zomato got listed in July 2021 and is now near its IPO issue price of ₹76. Meanwhile, Paytm is down over 72 percent from its issue price of ₹2,150.