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Food delivery giant Swiggy has entered into a definitive agreement with Times Internet to buy Dineout for an all-stock deal worth around $120 million or Rs 930 crores.
Dineout is a restaurant tech startup that operates in 20 major cities in India with a staff count of over 500. The application allows diners to book/reserve tables with all restaurants linked with the company and avail several discount deals. The company was founded in 2012 and was acquired by Times Internet, the media arm of the Times Group, in 2014.
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“We have had a strong bounce back from Covid, and our numbers are starting to surpass pre-Covid levels, leading us to explore much bigger opportunities,” Dineout's CEO Ankit Mehrotra said.
“Dineout is a well-loved brand that enjoys loyalty from both consumers and restaurants. Times Internet and the founding team should be credited for the transformational impact they have brought about in the dining out experience through their products, technology, and a vast selection of restaurant partners,” said Sriharsha Majety, CEO of Swiggy.
Dineout will be operating as an independent app even after the acquisition, which is expected to close over the next month. Swiggy is expected to strengthen its competitive position as it will finally foray into the dining out vertical and build upon it. Dineout, on the other hand, will be able to improve the scale of its operations as it will be able to access Swiggy's large customer base.
This acquisition can be seen as Swiggy's attempt to tackle Zomato's strategy of bringing in various business models. Zomato has been offering both restaurant dining and food delivery well before this acquisition and is ahead of Swiggy in the race. Recently, Swiggy was forced to suspend Supr Daily (grocery delivery) operations in 5 cities to help restructure its operations while Zomato's grocery delivery is ongoing but facing several difficulties.
Early on in March 2022, Swiggy formally launched the process of its IPO by appointing JP Morgan and ICICI Securities as lead managers for the issue. The IPO of the food delivery company is expected to hit the market by the end of FY23.
Article by Aman Agarwal.
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