Aditya Hadi Pratama · · 2 min readZomato to buy quick commerce firm Blinkit in $570m deal
Indian food delivery major Zomato said that it’s set to acquire quick commerce firm Blinkit for US$570 million in an all-stock deal. The transaction is expected to close in early August this year, pending shareholder and the stock exchange approvals.
Zomato will also spend US$8 million in cash to acquire Blinkit’s warehousing business.
Photo credit: Blinkit
The purchase value is far lower than Blinkit’s over US$1 billion valuation during its latest funding round. It entered the unicorn club after raising US$100 million from Zomato last year.
In a statement, Zomato CEO Deepinder Goyal noted that quick commerce is a natural extension of the company’s food delivery service, as both segments are hyperlocal businesses. “Quick commerce will help us increase the customer wallet share spent on our platform and also drive higher frequency and engagement from our customers,” he added.
Goyal also shared that Blinkit’s gross order value (GOV) has hit a fifth of Zomato’s food delivery GOV. In some cities, the number even reached 63% of Zomato’s.
See also: Zomato’s financial health in 5 charts
Founded in 2013 when it was known as Grofers, Blinkit delivers grocery and essential products to customers in 15 minutes. It offers around 4,000 stock-keeping units that are owned by the company and a network of third-party retailers.
Recently, the quick commerce firm fine-tuned the business and closed 50 non-performing dark stores – around 11% of its total network – between January and June.
The company was founded by former Zomato executive Albinder Dhindsa along with Saurabh Kumar – who stepped down from his executive position at Blinkit last year. It counts SoftBank, Tiger Global, and Sequoia Capital as its investors.
Goyal said that he will retain the Blinkit brand and let Dhindsa continue to run the business. “We believe that ‘super brands’ will work better in India than ‘super apps’,” the Zomato CEO added.
Currency converted from Indian rupees to US dollar: US$1 = 78 rupees.
Editing by Miguel Cordon and Lorenzo Kyle Subido
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