Zomato, the Indian food delivery giant, has acquired the entertainment ticketing business of financial services firm Paytm for $244.1 million, signaling a strategic move to enhance its “going out” offerings.
The acquisition, among the largest M&A deals among new-age Indian tech companies, encompasses Paytm’s ticketing services for movies, sports, and events. As part of the deal, Paytm’s flagship app will continue to host these offerings for up to 12 months, Paytm said in a stock exchange filing.
The acquisition coincides with a remarkable performance in Zomato’s stock market value, with shares soaring over 100% this year as the food delivery giant’s quick commerce business makes deeper inroads in India. Brokerage firm UBS said this week that it now values Blinkit, Zomato’s quick commerce service, at $15.4 billion, ahead of the Noida headquartered firm’s core food delivery business.
The acquisition also aligns with Zomato’s broader strategy to diversify its services, Bank of America analysts said. The move could significantly bolster Zomato’s ambitions to become a one-stop destination for dining and entertainment options, they wrote in a note.
“We believe that Zomato has been looking to re-position its fourth biz pillar from ‘dining-out’ earlier to include ticketed events, food festivals like Zomaland etc,” the analysts wrote.
Meanwhile, Paytm has been refocusing its efforts on its core fintech operations amid increased regulatory scrutiny. The company’s ticketing division, which was built through the acquisitions of Insider.in and TicketNew, contributed about 9% to Paytm’s overall revenues in the recent quarter. Paytm acquired Insider.in and TicketNew for a sum of about $32 million.
“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.
This is a developing story. More to follow.