Online food aggregator Zomato has decided to shut down all its international businesses. Zomato has also shut down its direct-to-consumer (D2C) experiment in Nutraceuticals.
“We are also shutting down our operations in Lebanon, which is the only international business we were left with (other than dining-out business in UAE) after shutting down the rest of our international operations last year,” Zomato said in a release.
The release mentioned that Zomato’s core food related businesses – food ordering and delivery, dining out and hyperpure (B2B supplies for restaurants) will remain its key value drivers for the next years. It noted that all the businesses Zomato is either divesting or shutting down contributed less than 1 per cent to its adjusted Revenue and 13 per cent to its adjusted EBITDA loss in Q2FY22.
“Our mainstay food ordering and delivery business is an opportunity where we expect huge shareholder value creation going forward. We believe that the food delivery market in India is still nascent, and there is an opportunity to grow the market at least 10x over the next few years,” Zomato underscored. It added that the company is pumping in investments in ecosystem companies around its food delivery business so that the cost of improving its food delivery business.
The release stated that Zomato is also in talks with several restaurant point-of-sale (POS) players, e-vehicle fleet operators to evaluate investments. Zomato has also decided to back a platform play for all direct-to-consumer (D2C) brands by investing in Shiprocket.
Besides this, Zomato is in the process of selling Fitso to Curefit for $50 million. The online food aggregator will also invest net $50 million cash investment plus value of the Fitso business (worth $50 million). Due to this investment, Zomato will have 6.4 per cent shareholding in Curefit.
The Gurugram-headquartered startup has inked documents for investing around $50 million in Samast Technolgies or ‘magicpin’ for a ~16 per cent stake as part of a total round size of $60 million. magicpin drives omni-channel growth for local retailers and 170,000 paying merchants in categories like food, fashion, electronics, grocery, entertainment and pharma across 50 cities in India.
“This will help us potentially explore cross-selling benefits between Zomato and Curefit, as we see food and health becoming the same side of the coin in the long term,” the release read.
Copyright©2022 Living Media India Limited. For reprint rights: Syndications Today