Published: Fri, February 02, 2018
Hi-Tech | By Cory Rios

Alibaba takes equity stake in Ant Financial

Alibaba takes equity stake in Ant Financial

The Board of Directors at Info Edge, subject to shareholders and other requisite approvals has made a decision to allow divestment of 32,629 (about 6.66 percent) equity shares of Zomato Media Private Limited of the paid-up share capital of Zomato on the fully converted and diluted basis either directly or through its fully owned subsidiary, Naukri Internet Services Limited (NISL), as may be deemed fit in the best interests of the Company by way of sale, transfer, assignment or disposal and to execute such agreements and other documents as may be required for the objective of or in relation to the divestment at an equivalent of $50 million.

In addition, the board of Info Edge has approved a proposal for divestment of 32,629 equity shares of Zomato for about Dollars 50 million to Ant, the filing added.

Ant Financial Services Group is focused on serving small and micro enterprises, as well as individuals.

The filing further mentioned that during FY 2016-17, Zomato recorded on consolidated basis net sales of $51.9 Mn (INR 3322.72 Mn).

Ant Financial will hold around 18% stake in Zomato post the investment.

Ant Financial has had a series of setbacks recently. Existing investor Info Edge will dilute its holding worth $50 million in Zomato, reported ET.

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The transaction is expected to close on 15 April 2018.

Before the share sale Info Edge owned about 44.74% stake in Zomato.

A cockroach start-up is defined as one which keeps struggling, going forward in spite of changing environments, market conditions and investment scenarios.

Started in 2008 by IIT-Delhi graduates Deepinder Goyal and Pankaj Chaddah, Zomato has so far raised about United States dollars 420 million including this round. It had previously managed to raise $60 million from Temasek and Vy Capital back in September 2015. Given that Ant has also invested in payments platform Paytm, it will be interesting to see if this new deal leads to any synergies going forward. Just last month, Zomato had beenvalued at $2.5 billion by Morgan Stanley. So the New Year has certainly kicked off with a bang for Zomato.

This the much awaited funding round for Zomato which trimmed its staff in 2016 and became profitable. Since starting out in 2014, Swiggy has already raised over $160 million in equity and debt including $80 million in May from Naspers Ltd and others.

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