Zomato to acquire Paytm's entertainment ticketing arm for ₹2,048 cr

Zomato is set to acquire Paytm's movie and events ticketing businesses for ₹2,048 crore, as both companies announced in a BSE filing late Wednesday evening. This move allows Zomato to expand its presence in the 'going-out' segment, while Paytm shifts its focus back to its core financial services.

As part of the deal, Paytm will transfer its ticketing businesses, TicketNew and Insider, along with 280 existing employees, to Zomato. These businesses, acquired by Paytm for ₹268 crore between 2017 and 2018, have recently reported a combined gross order value (GOV) of over ₹2,000 crore for FY24.

“This is not really an absolutely new business for us as we have already been doing ticketing as a business for more than a year now and have been eyeing building more use-cases for that business. Just to recap, our going-out business (which includes dining-out and event ticketing) did ₹3,225 crore of GOV in FY24 growing at 136% YoY,” says Zomato CEO Deepinder Goyal.

“It never gets spoken about much given all the attention food delivery and quick commerce get but this is already a profitable and large business for us,” he adds.

The food delivery platform also mentioned that no other significant physical infrastructure is being acquired.

“The company built the entertainment ticketing business to Revenues of ₹297 crores and Adjusted EBITDA of ₹29 crores in FY24,” Paytm parent company One 97 Communications states.

Zomato's new 'District' app, which will consolidate its dining and ticketing services, will replace Paytm's ticketing options over the next 12 months. This acquisition supports Zomato's strategy to integrate more lifestyle services, including dining, movies, and live events, into a single platform.

“During a transition period (up to 12 months), the movie and event tickets will continue to be available on the Paytm app, as well as on the TicketNew and Insider platforms, ensuring a smooth and uninterrupted experience for users and merchant partners,” Paytm adds.

Zomato's CEO did not confirm the exact launch date of the 'District' app but hinted that it could be released within the coming weeks. The deal was approved by the boards of both companies on August 21.

Highlighting the unfamiliarity of the new team, Zomato CEO states, “On the people side, this acquisition is our first major acquisition where we are acquiring a team that we do not know very well (in Uber Eats acquisition we did not acquire any team and in Blinkit we knew the founder and team really well). We are betting on the team much more this time and hoping everything works out well. The main driver of success is going to be cultural integration of the new team that will join us – which means assimilation of the new team into our flattish culture.”

The fintech company states that its decision to sell its entertainment ticketing business highlights its renewed focus on payments and financial services distribution. In recent quarters, the company has also broadened its scope to include insurance, equity broking, and wealth distribution, positioning itself to cross-sell these services and strengthen its market presence as a key player in financial services distribution.