Zomato completes acquisition of One97 Communications’ subsidiaries Orbgen Technologies and Wasteland Entertainment

Zomato notified the exchanges on Tuesday that it has completed the acquisition of One97 Communications’ subsidiaries Orbgen Technologies (OTPL) and Wasteland Entertainment (WEPL). Shares of the company were trading marginally in the red on Wednesday.

Last week, Zomato had signed definitive agreements to acquire Paytm’s entertainment ticketing business which is used by customers in India to discover and purchase tickets for movies, sports and events. Paytm’s entertainment ticketing business is housed across multiple entities within the Paytm ecosystem including the parent entity One97 Communications (OCL) and OTPL and WEPL.

Zomato had said that as part of the transaction the movies and events ticketing businesses of OCL will be carved-out and transferred by way of slump sale to OTPL and WEPL respectively. Zomato will then do a primary infusion into OTPL and WEPL for an amount equal to the slump sale consideration, which will be used to discharge the consideration payable to OCL for the slump sale.

Simultaneously, Zomato will also acquire a 100% stake in OTPL and WEPL from OCL.

Zomato had said that the business is being acquired for a total consideration of ₹2,048 crore. “The transaction also included a transition services agreement where the ticketing business will continue to run on the Paytm app for a period of up to 12 months to ensure a smooth transition of the business from Paytm to Zomato,” it said.

Zomato CEO Deepinder Goyal said the acquisition helps the firm add more scale and offer newer use cases (like movie and sports ticketing) to the firm’s customers in this segment. “It makes us more relevant for our customers, which also gives us an opportunity to spin off the business into a new app (we are going to call it District), which could be a game changer for each of these use cases given the need for a single brand as a destination in this segment,” he had said.

Shares of Zomato have gained over 105% since the beginning of the year and have risen over 177% in the last year.