Zomato Finalizes Acquisition of Paytm's Entertainment and Ticketing Business

Food delivery giant Zomato has successfully completed the acquisition of Paytm's entertainment and ticketing subsidiaries, WEPL (Wasteland Entertainment Pvt Ltd) and OTPL (Orbgen Technologies Pvt Limited). The transaction marks a significant expansion for Zomato as it ventures into the entertainment and ticketing space, further diversifying its portfolio.

Zomato's Strategic Acquisition: A New Chapter in Entertainment

On August 21, Zomato, led by CEO Deepinder Goyal, entered into definitive agreements to acquire Paytm's entertainment subsidiaries. The deal, valued at ₹2,048 crores on a cash-free, debt-free basis, underscores the strategic importance of this acquisition. Zomato's move to absorb WEPL and OTPL, which operate the TicketNew and Insider platforms respectively, reflects the company’s ambition to broaden its service offerings beyond food delivery.

Paytm Confirms Exit from Entertainment Segment

In a parallel announcement on August 21, Paytm, headquartered in Noida, confirmed the sale of its entertainment ticketing arms to Zomato. The decision aligns with Paytm’s renewed focus on its core businesses—payments and financial services distribution. According to Paytm, this divestment is a strategic step to concentrate resources on areas where the company sees the most potential for growth.

Details of the Acquisition

As part of the acquisition, Paytm's entertainment ticketing business, including TicketNew and Insider, will be transferred to Zomato. The transaction involves Paytm’s 100% stake in its subsidiaries OTPL and WEPL being sold to Zomato. This move will see about 280 employees from Paytm's entertainment division transitioning to Zomato, ensuring continuity and expertise in the new setup.

During a transition period of up to 12 months, users and merchant partners will continue to enjoy seamless access to movie and event tickets through the Paytm app, TicketNew, and Insider platforms. This ensures no disruption in service while the integration is completed.

Paytm's Journey in the Entertainment Sector

Paytm had initially built its movie ticketing business from the ground up and further expanded by acquiring TicketNew and Insider between 2017 and 2018 for a total consideration of ₹268 crores. Over the years, Paytm made additional investments to scale these platforms, creating significant value in the entertainment ticketing market. However, the decision to sell these assets is in line with Paytm’s strategy to double down on its core financial services.

Market Response to the Acquisition

The market responded positively to the news of the acquisition. Following the announcement, Zomato's stock opened in green on Wednesday at ₹256.20 per share. This upward movement reflects investor confidence in Zomato’s strategic direction. Over the past six months, Zomato has delivered an impressive 60% return to its shareholders, showcasing the company’s robust performance and growth trajectory.

Conclusion

The acquisition of Paytm's entertainment and ticketing business by Zomato marks a significant shift in the competitive landscape of India's entertainment sector. As Zomato integrates these new assets, the company is poised to enhance its market presence and diversify its offerings, potentially leading to new growth opportunities. Meanwhile, Paytm's exit from this segment allows it to sharpen its focus on its core financial services, aligning with its long-term strategic goals.