Zomato to rescue cash strapped Blinkit by lending loan of $150 million
Category: #business  By Pranali Mehta  Date: 2022-03-17
  • share
  • Twitter
  • Facebook
  • LinkedIn
Zomato to rescue cash strapped Blinkit by lending loan of $150 million

Zomato, India's most considerable food delivery, dining, and restaurant discovery service, will be investing $150 million in debt to save cash-strapped commerce startup Blinkit. The investment will be made in one or more transactions at an interest rate of 12% per annum within a year's tenure.

According to Zomato, this loan will fulfill the capital requirement of GIPL in the near term and is in contrast with the stated intent of investing around $400 million cash in quick commerce in India in the coming 2 years.

As per reports, Blinkit has last raised $100 million from Zomato in a round after which the firm entered into the unicorn club.

The deal indicates forming a new alliance in the space of short commerce in India.

Both the companies are also in the conversation for a stock-swap merger which is expected to be a round of approximately $700 million. The last round of Blinkit's valued the firm at over a billion dollars.

The development takes place when Blinkit shuttered dark stores, delayed payments of some vendors, and laid off employees due to the intense competition in the quick commerce industry.

Blinkit laid off staff from Hyderabad, Kolkata, and Mumbai across segments like pickers, riders, and store managers. At present, the firm has around 2,000 employees on its payroll and about 30,000 ground staff. This layoff has impacted approximately 5% of the total strength.

This is said to be an effort for cost-cutting by Blinkit as it has spent around Rs. 600 crores ($78 million) between November and February to expand its business and customer acquisition in the deep-discounted and cash-guzzling space.

It has around 445 dark stores at present after shutting down around 40 of them in the last few months.

Source Credit - https://www.moneycontrol.com/news/business/startup/zomato-to-give-150-million-debt-to-cash-strapped-blinkit-8235841.html

  • share
  • Twitter
  • Facebook
  • LinkedIn

About Author

Pranali Mehta

Pranali Mehta    

Pranali Mehta boasts of over three years of experience as a content writer. Having completed her graduation in chemical engineering, she worked as safety & environment associate in a chemical company for a year. Harnessing her passion for writing however, Pranali deci...

Read More >>

More News By Pranali Mehta

Neuralink to do trials for brain implants in human post FDA approval
Neuralink to do trials for brain implants in human post FDA approval
By Pranali Mehta

Neuralink Corp., a Elon Musk founded neurotechnology company, has reportedly obtained clearance from the US Food & Drug Administration (FDA) to proceed with its first clinical study involving humans. The approval is a significant leap forward ...

House of Lithium acquires EU micromobility startup Reby for USD 100M
House of Lithium acquires EU micromobility startup Reby for USD 100M
By Pranali Mehta

Canadian private equity firm House of Lithium has reportedly acquired Reby. The company was already a significant shareholder in the micromobility startup. The acquisition transaction was valued at USD 100 million. In a statement, Kevin Taylor, th...

Meesho to slash 251 jobs in new round of layoffs at its core unit
Meesho to slash 251 jobs in new round of layoffs at its core unit
By Pranali Mehta

Indian unicorn Meesho, an eCommerce platform, has recently confirmed a second round of layoffs within one year. This time it will terminate around 15% of its personnel, which is 251 employees, according to a spokesperson. Backed by Softbank and he...