Zomato Expands into Entertainment Ticketing with ₹2,048 Crore Acquisition of Paytm Insider
News Mania Desk/Agnibeena Ghosh/22nd August 2024
In a strategic move to diversify its business, Zomato has announced the acquisition of Paytm Insider, the entertainment and events ticketing division of One 97 Communications Limited (OCL), for ₹2,048.4 crore. This acquisition represents a significant expansion for Zomato, traditionally known for its food delivery and dining services, into the burgeoning field of entertainment ticketing.
The deal, which has received approval from Zomato’s board, involves a detailed Share Purchase and Subscription Agreement (SPSA) with OCL, Wasteland Entertainment Private Limited (WEPL), and Orbgen Technologies Private Limited (OTPL). Under this agreement, OCL will transfer its ticketing operations in movies, sports, and events to OTPL and WEPL through a slump sale. Subsequently, OCL will infuse capital into these subsidiaries through a preferential allotment, which will be utilized to complete the slump sale payment. Concurrently, Zomato will acquire OCL’s full stake in both OTPL and WEPL, making them wholly owned subsidiaries of Zomato.
The acquisition is expected to be finalized within 90 days of signing the SPSA, with the purchase price for OTPL set at ₹1,264.6 crore and WEPL at ₹783.8 crore. This expansion into the entertainment ticketing sector aligns with Zomato’s strategy to enhance its “Going-out” business, a growing area of interest for the company.
OTPL, established in 2007, focuses on movie ticketing and reported a turnover of ₹13.14 crore as of March 31, 2024. On the other hand, WEPL, which began operations in 2015, specializes in event ticketing and achieved a turnover of ₹236.03 crore for the same period.
The acquisition not only broadens Zomato’s portfolio but also underscores its commitment to expanding its offerings beyond food delivery. This move is part of a larger strategy to bolster its presence in the “going-out” segment, which includes various consumer activities such as movies, sports events, live performances, and more. Zomato’s founder and CEO, Deepinder Goyal, highlighted that integrating ticketing services into its existing platform provides an opportunity to enhance customer experiences across different aspects of entertainment and leisure.
In a social media post, Paytm welcomed Zomato into the entertainment sector, reflecting a positive and collaborative spirit regarding the transition. This acquisition builds on earlier indications from Zomato about its interest in expanding into the ticketing market, a move that was seen as a natural progression for the company’s strategic focus.
Additionally, the deal coincides with the launch of ‘District,’ a new app designed to consolidate Zomato’s “going-out” services. This app aims to provide a comprehensive platform for customers seeking diverse leisure and entertainment options. Goyal’s vision includes leveraging this expanded service portfolio to offer more integrated and seamless experiences for users, potentially revolutionizing how consumers engage with both dining and entertainment.
Overall, Zomato’s entry into the ticketing market represents a bold and innovative step, blending its food services with entertainment to capture a larger share of the consumer experience space in India. This strategic acquisition positions Zomato at the forefront of the evolving consumer landscape, setting the stage for future growth and diversification.
