Ant Financial, the Chinese payments giant, is in talks to lead a $600 million funding round in India’s leading food delivery app Zomato, people familiar with the matter told the Economic Times.
The Zomato deal may help Ant Financial build a more comprehensive ecosystem of services for consumers in India similar to the Alipay app in China, which can be used for food delivery, online shopping, bike-sharing, taxi-hailing and paying bills.
“While Ant Financial is leading the round and pumping in about $200 million, the rest of the capital is coming from existing backers like Temasek and others. A bunch of hedge funds may pool in about $150-200 million as well. These funds will be utilized to fuel our ambitions in food delivery, dining out and sustainability,” one of the sources said.
Ant Financial first came in as an investor in Zomato early last year, and according to regulatory filings, it raised its stake in the food delivery unicorn to 23% in November 2018. If the funding goes through, Zomato’s valuation could reach $3 billion, and Ant Financial will seek a raise in its stake to 29%, making it the largest shareholder in the company, ahead of InfoEdge.
Chinese tech giant Tencent is also competing against Alibaba by expanding its foothold in India. Bengaluru-based B2B online marketplace Udaan raised $585 million in Series D round from Tencent among others as the two Chinese tech giants compete for the larger share of the Indian market.