Zomato to acquire Paytm’s ticketing unit for Rs 2,048 cr

New Delhi: Online food delivery platform Zomato will acquire Paytm’s entertainment ticketing business for Rs 2,048 crore to strengthen its “going-out” segment in a deal that will help the troubled fintech firm to sharpen its focus on core payments and financial services distribution.

Paytm’s entertainment ticketing business covers movies, sports, and events (live performances).

The boards of Zomato and One 97 Communications Ltd (OCL) have approved the all-cash deal. As part of this agreement, OCL’s entertainment ticketing business will transfer business to its 100 per cent subsidiaries Orbgen Technologies Pvt Ltd (OTPL) and Wasteland Entertainment Pvt Ltd (WEPL), followed by the sale of 100 per cent stake in these subsidiaries (which operate the TicketNew and Insider platforms) to Zomato. Subsequently, Zomato will spin off the new business into a new app called ‘District’.

Under the deal, Zomato will fully acquire Orbgen Technologies Pvt Ltd (OTPL), which is into movie ticketing, for Rs 1,264.6 crore and buy Wasteland Entertainment Pvt Ltd, which is into events ticketing for Rs 783.8 crore. The combined entertainment ticketing business has a scale of Rs 297 crore in revenue and Rs 29 crore in adjusted EBITDA in FY24.

“The transfer will also include around 280 existing employees from the entertainment ticketing business,” OCL said in a statement, adding that the transaction generates significant profits for Paytm and cash proceeds will further strengthen the balancesheet. Announcing the deal, Paytm said it allows the fintech to strengthen its focus on core payments and financial services distribution. Paytm said with its strong focus on long-term value creation, the company remains confident in substituting revenue from its entertainment ticketing business by expanding core business areas of payments and financial service distribution.

“This move allows us to continue focusing on long-term growth in our core areas and value creation for all stakeholders,” a Paytm spokesperson said.

On the other hand, Zomato Managing Director and CEO Deepinder Goyal in a letter to shareholders said, “The proposed acquisition helps us add more scale and offer newer use-cases (like movie and sports ticketing) to our customers in this segment.”