The market realities are evolving with each passing day and the businesses are trying to make the best of whatever they got. According to sources, Paytm Mall is in conversations with online grocer Grofers for a potential investment. Speculations also have it that this move can lead to a merger as both the companies have a common thread; Softbank.
A source aware of the matter stated that Softbank does not have any fresh capital which it can obtain from the investment or the merger between Paytm Mall and Grofers. Paytm Mall has $170 million to invest presently which can be very well utilized to invest in a grocery platform which has been one of the few to be doing good in the lockdown.
A person aware of the development said, “SoftBank wants Grofers to get their (Paytm Mall) cash or absorb it back into Paytm given new money will be hard to come for the company.” Though nothing has been consolidated yet and there are high chances of deal not going through as the companies involved are not on the same page.
Softbank Vision Fund is the biggest shareholder in Grofers with 40% in hand while Softbank Group owns 20% stakes in Paytm Mall. Parallelly, Paytm Mall is also exploring other option in e-grocer segment as it has shown interest to invest or acquire Milk Basket. Milk Basket is backed by Kalaari Capital, Mayfield, Beenext and Unilever Ventures among others.
When asked about the development, Grofers said in an email, “We are not aware of any investments by Paytm Mall. We are an independent business and do not comment on speculation.” The advent of JioMart has also posed a great challenge for others in the business as they gear themselves to fight the competition.