In a significant move to expand its services, Zomato has announced its plan to purchase the entertainment ticketing division of Paytm for $244.2 million, which is approximately Rs. 2,049 crore. This acquisition aims to enhance Zomato's growing ticketing segment as it ventures further into the online marketplace for movie and live event tickets.
This transaction strengthens Zomato's foothold in India's digital ticketing arena, which is primarily led by Reliance-supported BookMyShow. Since 2017, Paytm has been a formidable competitor to BookMyShow and is now set to transfer its market advantage to Zomato through the sale of its 'ticketnew' ticketing service for films and the 'Insider' platform dedicated to live events.
Zomato anticipates that this acquisition will significantly elevate the gross order value of its ancillary businesses, projecting an increase of over three times within the next two years, as conveyed in a communication to its investors. Currently, Zomato's non-core sectors, which include restaurant reservations and event ticketing, contributed to only two percent of its overall revenue last year, yet they represent its most rapidly expanding areas.
The company initiated its ticketing venture just over a year ago. As per the acquisition agreement, Paytm will continue to provide ticketing services via its platforms for a duration of 12 months before fully transitioning operations to Zomato's new 'District' mobile app. Furthermore, Zomato plans to integrate around 280 employees from Paytm's entertainment ticketing division into its workforce.
Paytm developed its film ticketing capabilities organically and made acquisitions of Insider and TicketNew for 2.68 billion rupees between 2017 and 2018. However, the firm has decided to divest these operations to concentrate on its primary business of payment and financial services, especially following an order from India's central bank earlier in January to shut down its banking division.