operator One 97 Communications has agreed to sell its entertainment ticketing business to for Rs 2,048 crore in cash, as part of its strategy to focus on its core payments and financial services operations.
Under the terms, the Paytm parent will transfer its entertainment ticketing business to its 100% subsidiaries—Orbgen Technologies, which runs TicketNew; and Wasteland Entertainment, which manages Insider Platform. It will then sell a 100% stake in these subsidiaries for Rs 2,048 crore to Zomato on a cash-free, debt-free basis.
The transfer will include about 280 existing employees from the entertainment ticketing business to Zomato.
During the transition period, which will last up to 12 months, movie and event tickets will still be accessible through the Paytm app, as well as on the TicketNew and Insider platforms.
In FY24, Paytm’s entertainment ticketing business generated a combined gross order value (GOV) of Rs 2,000+ crore (29% YoY growth) and enabled purchase of 78 million tickets by 10+ million unique customers on its platform, Zomato said in a statement.
“We believe, over the next decade and beyond, going-out experiences will continue to grow strongly in lockstep with overall growth in lifestyle and consumption. The proposed acquisition helps us add more scale and offer newer use-cases (like movie and sports ticketing) to our customers in this segment,” Zomato CEO Deepinder Goyal said.
“This move allows us to continue focusing on long-term growth in our core areas and value creation for all stakeholders,” a Paytm spokesperson noted.
Paytm expects to close the transaction within this quarter.
Zomato had revealed in June that deal talks between the two companies were going on, citing that the acquisition “is in line with our stated position of focusing only on our four key businesses currently.”
The food delivery and quick commerce giant is set to revamp its stepping out vertical with its dedicated going out app District, which is slated to be launched in the next few weeks, it said during its earnings call. District, which would offer customer booking options for movies, sports ticketing, live performances, shopping, and ‘staycations’, would further tap on synergies with cross-integration from its quick commerce and food delivery segments.
Meanwhile, Paytm has been looking to focus more on its primary offerings including payments and financial services operations after Paytm Payments Bank Ltd (PPBL) was in legal trouble amid RBI scrutiny.
Paytm Payments Bank failed to put in place an internal mechanism to “detect and report” suspicious transactions as stipulated under the anti-money laundering law and was unsuccessful in conducting due diligence of its payout service, the Financial Intelligence Unit said in its order that imposed a fine of Rs 5.49 crore on the digital entity.
Paytm shares closed 0.36% higher at Rs 574.90 while Zomato shares closed 1.27% lower at Rs 259.77 on NSE today.
(The story has been updated.)
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