INDIA – Zomato, one of India’s most promising unicorns, has raised US$600 million in a primary financing round, giving the company a valuation of US$3.9 billion.

The financing and valuation comes at a time when the company is preparing for its IPO which is slated for early next year.

According to a report by Deal Street Asa, the fundraiser saw 10 investors join Zomato including Tiger Global, Kora, Luxor, Fidelity (FMR), D1 Capital, Baillie Gifford, Mirae, and Steadview.

According to a statement from Deepinder Goyal, Zomato’s Founder and Chief Executive, the company also has plans to raise an additional US$140 million as part of a secondary transaction and has already provided liqudity worth US$30 million to its former employees.

“I am grateful for their contribution in building Zomato and am glad that we created some wealth for these super amazing people,” Goyal said.

Zomato has been on a fundraising spree to bolster its cash reserves as it looks to build a war-chest for future acquisition as well as fight any possible fight wars in the coming month.

Earlier this year, Zomato acquired the Indian business of Uber Eats in an all-stock deal that will give the ride hailing company 9.99 per cent stake in Zomato.

The current US$3.9 billion valuation makes Zomato the most-valued food tech unicorn in India, surpassing Swiggy, which is valued at US$3.6 billion.

As a build up to the IPO, Zomato has also been making changes to its leadership, elevating Akshant Goyal to the position of Chief Financial Officer towards the end of October.

Akriti Chopra who was previously in charge of the startup’s finances was transferred and now handles people development in the organization.

Zomato and Prosus-backed Swiggy had seen their business being impacted by the COVID-19-induced lockdown.

During this time, Zomato and Swiggy ventured into the area of grocery delivery. With the easing of lockdown, the companies have been seeing demand returning on these platforms.

“Food delivery in India is rapidly coming out of COVID-19 shadows. December 2020 is expected to be the highest ever GMV month in our history. We are now clocking ~25% higher GMV than our previous peaks in February 2020,” said Goyal.

He said that the tailwinds for food delivery businesses are clearly visible, and that Zomato believes that the growth of the sector will accelerate post vaccine.

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