Zomato Acquires Paytm’s Entertainment Ticketing Business for ₹2,048 Crore
Introduction
In a significant move, Zomato has acquired Paytm’s entertainment ticketing business, which includes movie and event ticketing, for ₹2,048 crore. The acquisition is a strategic move for Zomato to expand its non-core businesses, while Paytm refocuses on its core payments and financial services.
The Deal
One 97 Communications Limited, the parent company of Paytm, announced the sale of its entertainment ticketing unit to Zomato on Wednesday. The transaction is expected to generate substantial profits for Paytm, with cash proceeds bolstering the company’s balance sheet. The entertainment ticketing services will continue to be available on the Paytm app during a transition period of up to 12 months.
Paytm’s Entertainment Ticketing Business
Paytm developed its movie ticketing business in-house and later acquired Insider and TicketNew for ₹268 crore between 2017 and 2018. The entertainment ticketing business achieved a combined revenue of ₹297 crore and an Adjusted EBITDA of ₹29 crore in FY24. However, Paytm has decided to exit this business to concentrate on its core operations in payments and financial services.
Zomato’s Strategic Move
The acquisition aligns with Zomato’s strategy to grow its non-core businesses, which include restaurant table booking services and an events organizing and ticketing unit. These two units represented 2% of Zomato’s total revenue last year and were among its fastest-growing segments. The acquisition will help Zomato expand its market share in the entertainment ticketing space.
Impact on Paytm
The sale of its entertainment ticketing business is a significant move for Paytm, which has been facing challenges in recent times. In February, the Reserve Bank of India directed Paytm to shut down its banking unit. This move follows Paytm’s efforts to refocus on its core payments and financial services.
Conclusion
The acquisition of Paytm’s entertainment ticketing business by Zomato is a strategic move for both companies. Zomato expands its non-core businesses, while Paytm refocuses on its core operations. The transaction is expected to generate substantial profits for Paytm and will help Zomato grow its market share in the entertainment ticketing space.
