Zomato plans IPO in 2021, ex-staff get $30 million cashout

Zomato Aims to Go Public by Mid-2021 Now Valued at $3.4 Billion Report

Online restaurant discovery platform Zomato has started preparations to go for an initial public offering (IPO) in 2021, making it the first among India's most valued consumer internet companies, or unicorns (valued at over $1 billion each) to plan a market debut.

With this $103 million, Zomato's valuation has shot up to $3.4 billion from $3.25 billion. Temasek Holding indirect subsidiary, MacRitchie Investments Pte.

In another important development, Zomato has also allotted worth $52 Mn or 182 crores fresh equity shares to its ESOP trust.

The investment is part of a larger funding round of up to US$ 600 million, announced by Zomato Founder and CEO Deepinder Goyal in December.

In addition to this, Zomato will be using this funding, as cash reserves to fight price competition in the market, as well as look at potential acquisitions in the space, which will boost its food delivery capabilities.

Adding more money to its bank account, Zomato has raised additional money from NY based Tiger Global, just a week after it had acquired $62 million from Singapore state investment arm Temasek. Kora is also pumping around $100 million, reports say.

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"Important note - we have no immediate plans on how to spend this money".

Tiger Global, Temasek, Baillie Gifford and Ant Financial have already participated in the company's current round, and there are more big names joining the round, he said.

"Our finance/legal teams are working hard to take us to IPO sometime in the first half of next year", Deepinder Goyal, Zomato's founder and chief executive officer, told employees in an email on Thursday, a copy of which Bloomberg News has obtained. "The value of our business is going up dramatically, all thanks to the hard work and commitment of our team,".

An official confirmation on the IPO from Zomato is awaited at the time of publishing this news. "We hope to create a lot of value for our current employees who have Esops next year".

The announcement was made at a time when Zomato and Swiggy had announced laying off over 1,600 employees as business was impacted by the COVID-induced lockdown. He also added that Zomato's value is increasing drastically and it was possible due to their dedicated team. Zomato has said previously that it was clocking improved unit economics over the past 12 months, and its food delivery business had recovered to 80% of pre-Covid-19 levels. In India, Tiger Global ramped up its investments significantly after exiting Flipkart in August 2018, ending a three-year hiatus.

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