Zomato is set to take over Paytm’s entertainment and ticketing business for Rs 2,048 crore as the food delivery major seeks to expand its business to the ‘going out’ segment.
This move would see Paytm turn its focus on its core financial services.
The two companies’ boards approved the cash transaction on August 21 and disclosed the exchanges.
As per the filing, the agreement will see One97 Communications, the parent entity of Paytm, transfer its movie ticketing business to its wholly-owned subsidiary OTPL, and its sports and events ticketing business to another wholly-owned subsidiary, WEPL, through a slump sale.
Advertisement
The acquisition cost of OTPL is estimated to be Rs 1,264.6 crore, while for WEPL, it is Rs 783.8 crore as per the filing. Zomato will complete the acquisition in the next 90 days.
Talking about the acquisition, Deepinder Goyal CEO of Zomato reportedly said, "This is not really an absolutely new business for us as we have already been doing ticketing as a business for more than a year now and have been eyeing building more use-cases for that business,” as per moneycontrol.
Paytm will retain the ticketing and entertainment options on its app for the next twelve months, However, users will be prompted to switch over to Zomato’s upcoming app for the ‘going out’ segment. Zomato will encourage customers to move to the new app ‘District’.
Advertisement
The move will see Zomato offer a wide range of lifestyle services including dining out, sports ticketing, live performances, shopping and more within the ambit of a single platform.
The acquisition could see Zomato invigorate its ticketing and events business through an integrated loyalty programme, find a way to cross-sell its food offerings and create better discovery of entertainment options for users.
