Zomato plans IPO in the first half of 2021; CEO Deepinder Goyal said in an email to employees

By : |September 11, 2020 0

Zomato has been in the front desk raising funds even during the pandemic. Recently, the company raised funds from Tiger Global, Kora Capital, and Temasek. Further, in an email to its employees, CEO Deepinder Goyal said that the unicorn has $250 million cash in the bank; more big names will be joining its current round. This will end up Zomato with $600 million in the bank very soon.

With the latest fundraise, Zomato is valued at $3.4 billion. It is very close to beating its rival Swiggy who has a $3.6 billion valuation.

On the IPO

Further, on the company’s IPO plan, Goyal wrote:

“Our finance/legal teams are working hard to take us to IPO sometime in the first half of next year. We hope to create a lot of value for our current employees who have Esops sometime in the next year.”

Goyal said Zomato’s burn rate had been reducing even as its market share was accelerating in all regions. The monthly burn rate for July was under $1 million, he had said earlier. Zomato has said previously that it was clocking improved unit economics over the past 12 months, and its food delivery business had recovered to 80% of pre-Covid-19 levels.

The email also said that the company had facilitated the sale of ESOPS for ex-employees worth $30 million (Rs 225 crore) to investors. “That’s a lot of meaningful wealth creation we have enabled for our people. On average, people sold their ESOPS at a 4x premium to what those shares were allotted to them back in the day,” he added.

Goyal said a number of former employees who had started up wanted to sell their shares. “Our IPO is around the corner. Waiting a little longer will result in significantly more value creation for all of us.”

According to the PTI report, he added that this cash is being treated as a ‘war-chest’ for future M&A. They will use the fund to fight off any ‘mischief or price wars’ from Zomato’s competition in various areas of its business.

We await official confirmation on the IPO from Zomato.

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