What Uber made out of zomato’s stellar listing will make everyone surprise.
Uber has made 560% return on its investment in Zomato, How?
Let’s go back to 2020 when Uber sold its Uber eats India operation to Zomato in a non-cash deal. On that Zomato issued 76,376 compulsorily convertible cumulative preference shares (CCCPS), which were later converted into 6121.991 Lakhs equity shares of Zomato(9.19% stake, in Zomato).
Uber India booked a profit of ₹703.4 crore on that deal, that 9.19% stake in zomato is now worth ₹9,084 crore ($ 1.2 billion on July 23, 2021).
The deal has fetched gains for Uber, for Zomato the deal was a loss making one as it has written off ₹233 crore as impairment in its books.
The Competition Commission of India (CCI) has issued a show cause notice to Zomato for failing to take approval of the regulator for the deal.
The CCI could impose a penalty of up to 1% of the combined entity’s turnover (₹1,994 crore as of FY21) or assets (₹8,704 crore as of FY21), whichever is higher as stated in DRHP.
This is purely based on financial perspective we cannot ignore the fact that the customers and customers data zomato acquired in that deal and reducing the competition by consolidation.
The other investor who made fortune in this listing is Sanjeev Bikhchandani, founder of Info Edge, which invested Rs. 4.7 crore back in 2010 is now worth Rs. 15,000 crores.
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