In a strategic move to diversify its portfolio, Zomato has announced the acquisition of Paytm Insider, the entertainment and events ticketing arm of One 97 Communications Limited (OCL), for ₹2,048.4 crore. The deal, approved by Zomato’s board, marks the company’s entry into the entertainment ticketing sector, complementing its core food delivery and dining services.
According to a regulatory filing made on Wednesday, Zomato will enter into a Share Purchase and Subscription Agreement (SPSA) with OCL, Wasteland Entertainment Private Limited (WEPL), and Orbgen Technologies Private Limited (OTPL). This complex transaction involves OCL transferring its movie, sports, and events ticketing businesses to OTPL and WEPL through a slump sale. Following this, OCL will inject capital into these subsidiaries via a preferential allotment, using the proceeds to cover the slump sale payment. Concurrently, Zomato will acquire OCL’s entire stake in both OTPL and WEPL, making them wholly owned subsidiaries of Zomato.
The acquisition deal is set to be completed within 90 days of signing the SPSA, with the valuation of OTPL at ₹1,264.6 crore and WEPL at ₹783.8 crore. This move is part of Zomato’s broader strategy to expand its “Going-out” business, an area the company identifies as a key growth sector.
OTPL, operational since 2007, specializes in movie ticket listings and recorded a turnover of ₹13.14 crore as of March 31, 2024. WEPL, which entered the market in 2015, focuses on event ticketing and achieved a turnover of ₹236.03 crore over the same period. The acquisition is expected to significantly bolster Zomato’s presence in the entertainment ticketing market.
Paytm responded to the acquisition with a lighthearted social media post, welcoming Zomato into the entertainment sector with a playful message: “Knock, knock @zomato! We’ve dropped off some 🎬 to go with your 🍕. Hope you’re ready for some real fun – showtime is now in your hands! 🎥.”
The acquisition aligns with Zomato’s earlier reports from June, where the company indicated its interest in acquiring Paytm’s movie and events businesses. This move was seen as part of Zomato’s plan to strengthen its “going-out” segment, which includes various customer experiences beyond dining, such as movies, sports, live performances, and staycations.
The deal also coincides with the launch of ‘District,’ Zomato’s new app designed to consolidate its “going-out” offerings. Zomato Founder and CEO Deepinder Goyal highlighted the opportunity to expand their offerings beyond dining, stating, “We believe that there is an opportunity to further expand our going-out offering, building on top of our dining-out business.”
This acquisition represents a significant expansion for Zomato as it blends food and entertainment into a cohesive experience, aiming to enhance its footprint in India’s dynamic consumer market.
