In a deal that could mark further consolidation in the micro-delivery space, BigBasket has revived talks to acquire milk and daily essentials company, DailyNinja.
Sources tell CNBC-TV18 that talks are in exploratory stages at this point in time – a large number of details including the deal value, structure, and other contours need to be ironed before the deal can go through. The deal could happen at a 30 percent premium to the valuation of DailyNinja, which stands at an estimated $ 40-45 million.
The micro-delivery space has been seeing intense competition over the last two years. To strengthen its play in this segment, BigBasket acquired companies like RainCan and MorningCart in 2018.
At present, BigBasket’s BB daily service, which delivers essentials like milk, eggs, etc., is making about 140,000 deliveries a day. Sequoia Capital-backed DailyNinja has also been steadily expanding in the space and makes about 70,000 to 75,000 deliveries a day. If the deal goes through, BigBasket will get a significant leg-up in the micro-delivery space.
“It’s difficult to make money in the daily delivery space. There are plenty of overhead costs and margins are pretty low. Therefore, companies are always looking to raise money in some form or the other,” said a person close to the development.
Acquisitions like these could also give a company access to a good customer base. DailyNinja has a good set of investors on board including the likes of Sequoia Capital, Matrix Partners, and Saama Capital. Another direct rival, Milkbasket has been aggressively looking to raise funds. Having raised a total of 28 million dollars so far, reports suggest that Milkbasket is eyeing a 50 million dollar fundraising in the next round.
These developments come at a time when online giant Amazon and Walmart-owned Flipkart are stepping up their game in the grocery space. Flipkart recently set up a new food retail company called Flipkart FarmerMart Private Limited in Bengaluru to operate its food retail business. Amazon too launched its Amazon Fresh store in August for select pin codes.
In response to CNBC-TV18, BigBasket said, “Nothing to share on DailyNinja.” Meanwhile, DailyNinja denied the news and said, “We aren't in talks with BigBasket.”
First Published: IST