Indian restaurant discovery and food delivery app Zomato has raised US$150 million in funding from existing investor Ant Financial, the Economic Times reported, citing people familiar with the matter.
The deal, which is part of a larger US$500 million round that’s expected to close in the next two months, values the startup at about US$3 billion, a separate source added. Ant Financial first invested in the food delivery unicorn early in 2018 and further raised its stake to 23% in November of that year, according to regulatory filings.
The development comes as Zomato emerges as one of the front-runners to acquire Uber’s food delivery business in the country through a stock-swap deal pegged at US$300 million. Uber is also reportedly looking into a potential investment in the Gurgaon-based startup as part of the latter’s larger investment round.
According to an earlier report by the Economic Times, which cited two people familiar with the development, Zomato was engaged in early talks with investors to raise US$600 million to focus on food delivery, dining, and sustainability.
The round was reportedly set to be led by a US$200 million investment from Ant Financial, with the rest of the capital coming from existing backers such as Temasek, said one of the sources.
The additional investment could help Zomato fend off rising competition from rival Swiggy, which is reported to be raising up to US$750 million in a round led by existing investor Naspers. The South African internet giant is set to pour in around US$350 million, while US$50 million will come from Korean investors including STIC Investments and Korea Omega Investment, according to a Livemint report.
For FY 2019, Zomato saw its revenue more than triple to US$206 million from US$68 million in FY 2018. The increase was mostly driven by its food delivery business, according to the company’s most recent annual report.