Zomato in talks to acquire Paytms movie events Filesadmin.co for Rs 2000 crore
Food delivery major Zomato is in advanced talks to acquire fintech player Paytm’s movie and event ticketing business, a potential deal that is pegged in the range of Rs 1,600 crore-2,000 crore, sources said.
The talks are taking place at a time when Paytm is focusing on its payments and financial services business.
Once finalised, this will be the food delivery major’s second biggest purchase since acquiring Blinkit in 2022 for $569 million in an all-stock deal.
Sources said that Paytm is currently merging its movies business and the insider vertical into a single team.
Attempts to connect with Paytm and Zomato were not successful till the time of the press.
The Vijay Shekhar Sharma-led firm is trying to regain the lost ground by doubling down its focus on payments, and adopting a distribution-first approach for financial services. As such, the company is focusing on its larger businesses that can grow and become profitable at scale.
“Paytm wants to focus on scalable commerce. The company’s focus will continue to be on digital goods commerce so segments like deals, gift vouchers, and travel, which help its merchants to scale their business and boost overall sales,” sources said.
With this deal, the company now does not have any “non-core” businesses.
Paytm said it will steer away from non-core operations and focus on trimming its employee costs.
To achieve this, the firm is reviewing its decision to continue non-core operations such as cross border business and software as a service (SaaS) to banks, among others.
“If you notice the cost structure of overall engineering and technology, it has been larger than what a pure payment company would have had,” Sharma said during the analyst call post Q4 results.
The company will trim its employee costs and expects annualised people cost savings of Rs 400-500 crore.
While Paytm does not disclose figures for its movie and events ticketing business independently, it recorded annual sales of around $208 million in the financial year ending March 2024 for its broader marketing services segment. This includes the ticketing and movies business, along with credit card marketing, and gift vouchers.
The deal will be Zomato’s second-largest acquisition after Blinkit
Last week, Zomato said it will invest Rs 100 crore in Zomato Entertainment, its live events and ticketing business
First Published: Jun 16 2024 | 8:29 PM IST