A $500 mn deal between Zomato-Blinkit is expected to be unveiled this month
According to sources, this might be a $500 million deal, valuing Blinkit at $1.5 billion, a huge increase from its current $1 billion valuation
Zomato, the food delivery company, is expected to increase its investment in Blinkit (previously Grofers), a quick-commerce start-up, according to insiders. The announcement is expected in the second part of February. According to sources, this might be a $500 million deal, valuing Blinkit at $1.5 billion, a huge increase from its previous $1 billion estimate. Deepinder Goyal, the creator and CEO of Zomato, recently sold his interest in Blinkit to Tiger Global.
Zomato invested $100 million in Blinkit last year, valuing it at $1 billion. SoftBank, a Japanese investment powerhouse, owns about 45 percent of Blinkit, while Tiger Global owns more than ten percent of the company, valued more than $100 million.
"The fresh funds infusion by Zomato is likely to involve a secondary share sale by SoftBank," one of the sources privy to the development said.
The deal, which is being hailed as one of the largest in the fast commerce space to date, will give Blinkit more firepower to take on competitors such as Zepto, BigBasket, and Reliance-backed Dunzo, among others.
When Business Today contacted Zomato and Blinkit about the changes, both companies declined to comment.
Deepinder Goyal's departure from Blinkit, according to sources, is a sure sign that another large investment in the grocery delivery startup is on the way.
Royal has made a number of investments in several start-ups in his personal capacity, in addition to driving food delivery giant Zomato to a successful public debut. Last year, Goyal left logistics startup business Shiprocket, after which Zomato led a $120 million fundraising round in the company.
In response to a question on Twitter from Mohandas Pai, former Infosys Director and Chairman, on whether Goyal's personal ownership in start-ups where Zomato invests creates a "conflict of interest," the Zomato CEO categorically disputed the accusation, saying that no such conflict of interest exists.
"This personal investment was one of the key reasons we got closer to Shiprocket (and its founders). That's how we discovered that there was potential long-term strategic fit between the two companies… Also, such things (personal investments followed by Zomato stepping in) might continue to happen by design, while we continue to ensure the highest levels of disclosure and corporate governance at Zomato," Goyal had said.