IPO-bound foodtech company Zomato and Tiger Global have invested $120 million into e-grocery player Grofers, turning it into a unicorn with a valuation of over $1 billion.
Zomato is expected to seek CCI approval soon for the deal. Zomato could also look at a possible acquisition of Grofers post its IPO, which is expected in a few months.
Grofers CEO Albinder Dhindsa had said in a June 21 blog post that 'next round of funding is secure' while announcing that the company would give 33 percent hikes to its tech teams.
"After coming out of the second wave, and at a point where our next funding round is secure, I think it is time to kickstart a lot of initiatives that I have been waiting for the right time to begin," Dhindsa wrote in the post.
"The entire tech team gets a no-ifs-and-buts 33 percent increase in salary starting July (i.e. if your annual salary was Rs 30 lakhs, it will now be Rs 40 lakhs). Depending on how much impact each of you have created over the last year, there will also be a hefty ESOP allocation coming your way which will be communicated to you in the next few weeks,' he added.
Grofers' co-founder Saurabh Kumar had earlier this month announced he was moving out of the company, though he would continue to stay on the board.
Tiger Global is a common investor in Zomato and Grofers, and as of July 2020, held a nearly 20 percent stake in Grofers, as per data from Tracxn. Softbank, which is a large shareholder in Grofers, is not expected to participate in this funding round.
Grofers' larger competitor BigBasket recently got bought out by the Tata Group, which pumped in over $1 billion into the company to add the e-grocery business to its Tata Digital arm.
For Zomato, adding e-grocery to its cart would be crucial as rival Swiggy is pushing aggressively on its hyper-local as well as grocery delivery services, while e-commerce players Amazon and Flipkart are also investing heavily into high-frequency grocery deliveries.
(Edited by : Aditi Gautam)
First Published: IST