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Exclusive: China’s Alipay to sell its stake in India’s Zomato for nearly $400 million

The logo of Indian food delivery company Zomato is seen on its app on a mobile phone displayed in front of its company website in this illustration picture taken July 14, 2021. REUTERS/Florence Lo/Illustration/File Photo
The logo of Indian food delivery company Zomato is seen on its app on a mobile phone displayed in front of its company website in this illustration picture taken July 14, 2021. REUTERS/Florence Lo/Illustration/File Photo

Exclusive: China’s Alipay to sell its stake in India’s Zomato for nearly $400 million. Three sources and a study of the deal’s term sheet by Reuters indicate that the Chinese payments business Alipay intends to sell its 3.4% share in the Indian food delivery behemoth Zomato (ZOMT.NS) for approximately $400 million through block trades on Indian stock markets. This information comes from the Chinese payment group Alipay.

However, Alipay, which Ant Group controls, would sell off its entire 3.44% interest in the transaction, according to the term sheet that Reuters reviewed.

According to the three people who declined to be named because the plan is confidential, Bank of America and Morgan Stanley are serving as advisers on the transaction, which is expected to be performed later this week on Indian markets.

In response to a request for comment, Zomato, Bank of America, and Morgan Stanley did not immediately provide a suitable response. Alipay did not reply to any inquiries outside of regular business hours.

This year, Zomato shares have increased by more than 90 percent, following a decline of more than 50 percent in 2022, when technology equities were struggling worldwide.

The first source stated that Alipay “wants to cash out… the market timing is good,” alluding to the substantial increase in Zomato’s share price over the many months that have passed.

According to the term sheet, the block agreements are scheduled to be performed at 111.28 rupees per share, which represents a reduction of 2.2% compared to Zomato’s closing price on Tuesday.

In October, the Japanese company SoftBank (9984.T) sold a 1.1% share in Zomato, India’s most successful meal delivery business. As a result of the enormous growth in demand for online ordering over the past several years, businesses such as Zomato have been actively expanding their operations.

At the same time that other Chinese investors have been decreasing their shares in Indian firms, Alipay has decided to withdraw from Zomato. China’s Antfin sold a 10.3 percent stake in the giant Indian financial company Paytm (PAYT.NS) in August.

According to the term sheet, the block agreements are scheduled to be performed at 111.28 rupees per share, which represents a reduction of 2.2% compared to Zomato’s closing price on Tuesday.

During October, the Japanese company SoftBank (9984.T) sold a 1.1% share in Zomato, the most successful meal delivery business in India. As a result of the enormous growth in demand for online ordering over the past several years, businesses such as Zomato have been actively expanding their operations.

At the same time that other Chinese investors have been decreasing their shares in Indian firms, Alipay has decided to withdraw from Zomato. In August, China’s Antfin sold a 10.3 percent stake in the giant Indian financial company Paytm (PAYT.NS).

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