Info Edge scales back stake sale plan in upcoming Zomato IPO

As food tech unicorn Zomato gears up for its upcoming initial public offering (IPO), early investor Info Edge, parent of popular internet properties such as Naukri.com and Jeevansathi.com, has modified its exit game plan.  

In a stock exchange filing on Sunday, the company said that it will sell only Rs 375 crore ($50 million) worth of stake in Gurugram-based Zomato’s IPO. Previously, it had approved an offer for sale of equity shares worth up to Rs 750 crore ($100 million). 

“The committee of executive directors of the company, having been duly authorized in this regard, have considered and given their approval today...for a reduction in the size of the Offer for Sale by the Company to the extent permitted under the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018,” Info Edge said in the filing. 

Further details of the sale would be included in the red herring prospectus and other documents related to the offer, it added.  

In the draft red herring prospectus filed with SEBI in April, Zomato had proposed an initial public offering (IPO) of up to Rs 8,250 crore, comprising of a fresh issue and Info Edge’s original offer for sale. The company received SEBI’s observations on July 2 and is yet to file final documents for the issue.

Queries sent by TechCircle to the company remained unanswered at the time of publishing the article. 

The Naukri parent is one of the earliest institutional backers of Zomato. It had acquired a third of the company in 2010 for just $1 million (Rs 4.7 crore).  

However, as more investors came in, Info Edge’s shareholding shrunk with partial exits. 

At the end of last funding round in February 2021, the food-tech company was valued at $5.4 billion, with Info Edge holding about 18.4% on a fully diluted basis. 

The upcoming IPO would be the first public market outing for an India-born food-tech firm and a unicorn from the country.  

Zomato aims to raise aims to raise up to $1 billion through the offering.