Chinese funds group Alipay plans to promote its 3.4 p.c stake in Indian meals supply large Zomato for practically $400 million (practically Rs. 3,333 crore) via block offers on Indian inventory exchanges, in line with three sources and a Reuters evaluate of the deal’s time period sheet.
Alipay, owned by Ant Group, will offload its complete 3.44 p.c stake within the deal, the time period sheet seen by Reuters confirmed.
Bank of America and Morgan Stanley are advisers on the deal, which is prone to be executed later this week on Indian exchanges, mentioned the three sources, who declined to be named because the plan is non-public.
Zomato, Bank of America and Morgan Stanley didn’t instantly reply to a request for remark. Alipay additionally didn’t reply outdoors common enterprise hours.
Zomato shares have surged greater than 90 p.c this yr, after falling by greater than half in 2022 when tech shares struggled all over the world.
Alipay “wants to cash out … the (market) timing is good,” mentioned the primary supply, referring to the speedy rise in Zomato’s shares in current months.
The block offers are set to be executed at Rs. 111.28 per share, a 2.2 p.c low cost to Zomato’s shut on Tuesday, the time period sheet mentioned.
In October, Japan’s MushyBank bought a 1.1 p.c stake in Zomato, which is India’s greatest meals supply service. Demand for on-line ordering has quickly grown in recent times, prompting corporations like Zomato to aggressively broaden.
Alipay’s exit from Zomato comes as different Chinese buyers have been paring their stakes in Indian corporations. In August, China’s Antfin bought a ten.3 p.c stake in Indian monetary large Paytm.
Tech shares comparable to Zomato have staged a rebound after a drubbing final yr amid a market meltdown, when buyers additionally raised questions on sky-high valuations of some Indian startups that had made their inventory market debut in recent times.
© Thomson Reuters 2023
