Deepinder Goyal-led food delivery giant Zomato has confirmed that it is in discussions with Paytm to acquire its movie ticketing and events business.
“We acknowledge that we are in discussions with Paytm for the aforementioned transaction, however, no binding decision has been taken at this stage that would warrant a Board approval and subsequent disclosure in accordance with applicable law,” Zomato said in an exchange filing.
Focused on strengthening its ‘going out’ business
Zomato mentioned that the discussions are aimed at strengthening its ‘going out’ business, aligning with its strategic focus on its four key business areas.
“The above-mentioned discussion is being undertaken with an intent to further strengthen our going-out business and is in line with our stated position of focusing only on our four key businesses currently,” the company said.
The move is seen as a strategic step to enhance Zomato’s offerings in the events sector, potentially competing with established players like BookMyShow.
What does Paytm say about these discussions?
Paytm has also confirmed the ongoing discussions in a separate regulatory filing, although it did not specifically name Zomato.
“The Company routinely explores various strategic opportunities aimed at enhancing shareholder value. The potential transfer of Paytm’s Entertainment business, a component of our Marketing Services, is one opportunity under consideration,” Vijay Shekhar Sharma-led Paytm said in an exchange filing.
“As noted in our earnings call, our focus will be on payment and financial services along with digital goods commerce, which are designed to help our merchants scale their businesses,” the company added.
Both companies have clarified that the discussions are preliminary and non-binding.
The value of the deal
While neither Zomato nor Paytm have confirmed the valuation of the deal, media reports suggest that the acquisition could be valued at approximately Rs 1,500 crore.
The deal, if finalized, would be Zomato’s second-largest acquisition following its purchase of Blinkit (formerly Grofers) in 2021 for Rs 4,447 crore.
The potential acquisition would signify a substantial expansion of Zomato’s event-related services, complementing its existing food delivery and quick commerce businesses.
