Zomato all set to raise funding from Temasek
2 min read 21 Aug 2020, 09:53 PM ISTThe potential deal may lead to an infusion of at least $60 million into the company, as per its valuation in the last fundraising in JanuaryAccording to the proposed deal, Zomato will sell 15,188 shares to MacRitchie Investments, according to regulatory filings

Bengaluru: Online food ordering platform Zomato is in the final stages of raising funds from MacRitchie Investments, a unit of Singapore’s state investment arm Temasek Holdings.
According to the proposed deal, Zomato will sell 15,188 shares to MacRitchie Investments, according to regulatory filings with the corporate affairs ministry, reviewed by Mint. The value of Zomato’s shares was not disclosed.
The potential deal may lead to an infusion of at least $60 million into the company, as per its valuation in the last fundraising in January.
Zomato, whose business was severely disrupted by the covid-19 pandemic, has added an additional subscription of ₹184.15 crore to its Foodie Bay Employees ESOP trust, showed regulatory filings. Additionally, it has received $5 million ( ₹38 crore) in March from Pacific Horizon Investment Trust, which is managed by UK-based Baillie Gifford & Co. Ltd.
The development was first reported by online news portal Entrackr.
In July, Mint reported that new foreign direct investment rules would pose challenges for the Gurugram-based startup to tap into the $150 million capital it raised from Ant Financial, a unit of Chinese internet giant Alibaba, in January. The fundraising had valued Zomato at $3 billion.
India imposed stricter rules around foreign investments from neighbouring countries with effect from April. The change was mainly aimed at restricting investments from China.
Zomato had already received the first tranche of about $50 million from Ant Financial in January, but the remainder got delayed due to the government restrictions. Since then, the food-tech startup had been scouting for new investors to chart its next phase of growth, as its business continues to lose money.
Rival Swiggy raised $113 million from Naspers in February.
In July, Zomato released data of its financial performance for 2019-20, which showed a doubling of revenue to $394 million, although it recorded a loss of $293 million.
“Right after the rise of covid-19 cases in India towards the end of March, our food delivery GMV (gross merchandise value) hit its lowest point in two years. GMV was 80% down in the last week of March 2020, compared to our peak pre-covid-19 week (in mid-February)," Deepinder Goyal, founder and CEO of Zomato, said while announcing the results.
The company also said that it expects its monthly burn rate to drop to under $1million.
However, according to a recent report released by Zomato, the food delivery industry is nearing pre-covid levels with the sector now registering 75-80% of pre-covid GMV or gross merchandise value.
Zomato also said that it expects the food delivery industry to hit pre-covid levels of business in the next 2-3 months. The company also said that the number of restaurants offering food delivery on its platform is at 70% of pre-covid levels, in its report.
In a bid to increase its capital runway, Zomato laid off almost 540 employees in May and halved salaries until the end of this year.
In recent months, Zomato has also scaled down its online grocery delivery vertical, Zomato Market, which it launched in April, during the early days of the lockdown through partnerships with several fast-moving consumer goods companies and local grocery stores to provide deliveries in over 185 cities. Zomato also partnered with Grofers for last-mile delivery of essentials.