India’s anti-monopoly watchdog, the Competition Commission of India (CCI) has approved Zomato’s request to invest in the online grocery delivery platform, Grofers India, along with its wholesale unit Hands on Trades.
The proposed acquisition by Zomato of approximately 9.3 per cent stake in Grofers India and Hands on Trades has been approved, the regulatory authority tweeted on 13 August 2021.
The food delivery aggregator had sought CCI’s approval for the acquisition in June 2021.
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The acquisition is being seen as Zomato’s push to get back into the grocery delivery business, with its competitor Swiggy doubling down on the same with Instamart.
Notably, Zomato also recently re-launched its own grocery marketplace, Zomato Market, that presently caters to the public in the Delhi-NCR.
In June 2021, Grofers had finalised the USD 120 million investment from Zomato and Tiger Global, valuing it at a little over $1 billion. Interestingly, Tiger Global is also an investor in Zomato.
Presently, Zomato does not have much idea about online grocery and is just trying to learn. The company thinks it is a big space but is not sure about a long-term commitment, Zomato boss Deepinder Goyal had clarified recently.
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The investment in Grofers is separate, as the company has its own grocery offering which is based on the marketplace model, he had clarified.
Grofers was the only large online grocer left standing, which prompted Zomato to back it, he said.
After the acquisition news went public , Zomato’s shares rose around 1.55 per cent on 13 August 2021, to Rs. 137.55 apiece on the Bombay Stock Exchange (BSE), with the benchmark Sensex ending the day 1.08 per cent higher at 55,437.29 points.
