Indian food delivery giant Zomato has acquired the entertainment ticketing business of fintech firm Paytm for $244.1 million, in a bid to diversify its businesses.
As part of the acquisition, one of the largest among new-age Indian tech companies, Paytm will continue to offer ticket sales for up to 12 months and 280 of its employees will join Zomato, the companies in a statement said.
In India the online entertainment ticketing business exists in a duopoly, with Reliance-backed BookMyShow controlling around 75 per cent of it, while the rest under Paytm's sway, according to Jefferies.
The acquisition comes in the wake of Zomato's shares soaring over 100 per cent this year, largely on the back of the company's quick commerce business – Blinkit.
According to brokerage firm UBS, Blinkit is at present valued at $15.4 billion, ahead of the firm's core food delivery business.
Zomato ended trading Wednesday with a market cap of $27.3 billion.
"The proposed acquisition helps us add more scale and offer newer use-cases (like movie and sports ticketing) to our customers in this segment," Zomato founder and chief executive Deepinder Goyal said in a statement.
"It makes us more relevant for our customers which also gives us an opportunity to spin-off the business into a new app (we are going to call it District) which could be a game changer for each of these use cases given the need for a single brand as a destination in this segment," he said.
On the other hand, Paytm's disposal of its ticketing arm comes as part of its refocusing on its core fintech operations even as it continues to face an regulatory scrutiny.
"Paytm's move to sell its entertainment ticketing business underscores its core focus on payments and financial services distribution," Paytm said in a stock exchange filing.
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