Zomato to Acquire Paytm’s Entertainment Ticketing Business for Rs 2,048 Crore: Complete Details Inside!
Zomato to acquire Paytm's entertainment ticketing business for Rs 2,048 crore.
On August 21, Zomato announced that it is set to acquire Paytm's entertainment and ticketing business for Rs 2,048 crore (approximately USD 244 million). This deal, approved by both companies' boards on yesterday, marks a significant expansion for the leading online food service platform.
Incorporated in 2010, Zomato is a prominent online food service platform known for its substantial value in food sales. Its services encompass food delivery, dining-out options, loyalty programs, and more.
The acquisition includes Paytm's movie ticketing business, which will be transferred to Orbgen Technologies Pvt Ltd (OTPL), and its sports and events ticketing business, which will be handed over to Wasteland Entertainment Pvt Ltd (WEPL). The deal involves a slump sale, where One97 Communications, Paytm’s parent company, will divest these assets through its subsidiaries.
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In FY24, the business being acquired generated a combined GOV of Rs 2,000+ crore (29 per cent YoY growth) by enabling the purchase of 78 million tickets by 10+ million unique customers on its platform. During the same period, the business generated Revenue of Rs 297 crore and Adjusted EBITDA of Rs 29 crore (translating to about 1.5 per cent Adjusted EBITDA margin as per cent of GOV).
Paytm, which has faced challenges and aims to refocus on its core financial services, has been a competitor to BookMyShow since 2017. The platforms being sold include 'TicketNew,' which handles movie ticket sales, and 'Insider,' which manages tickets for live events. Paytm developed its movie ticketing business internally and acquired Insider and TicketNew for Rs 2.68 billion between 2017 and 2018.
As part of the acquisition, Zomato will make a primary infusion into OTPL and WEPL through a preferential allotment, matching the slump sale consideration. This infusion will facilitate the settlement of the amount payable to OCL for the slump sale. The estimated acquisition cost for OTPL is Rs 1,264.6 crore, while for WEPL, it is Rs 783.8 crore. Zomato anticipates completing the acquisition within 90 days.
Today, the shares of Zomato and Paytm were in focus and closed at Rs 257.80 & Rs 554 each on the BSE.
Investors must keep these stocks on their radar.
Disclaimer: The article is for informational purposes only and not investment advice.