Paytm, has announced the sale of its entertainment ticketing business to food aggregator Zomato. The deal, valued at Rs 2,048 crore, is a cash transaction and marks a strategic shift for Paytm as it seeks to concentrate on its core payments and financial services distribution. The sale includes the transfer of approximately 280 employees from Paytm's entertainment ticketing business to Zomato. The deal is expected to be completed within 90 days from the signing of the share purchase and sale agreement, subject to the satisfaction of agreed conditions precedent.
The entertainment ticketing business of Paytm, which includes movies, sports, and events, will continue to be available on the Paytm app during a transition period of up to 12 months. The transaction is expected to generate significant profits for Paytm, and the cash proceeds will further strengthen the company's balance sheet. The parent company of Paytm, One 97 Communications Limited (OCL), will transfer its entertainment ticketing business to Zomato by transferring OCL's entertainment ticketing business to its 100 per cent subsidiaries -- Orbgen Technologies Pvt Limited (OTPL) and Wasteland Entertainment. These subsidiaries currently manage the TicketNew and Insider platforms, both of which have become prominent names in India 's ticketing landscape.
The acquisition of Paytm's entertainment ticketing business is a strategic move for Zomato, which has been expanding its offerings beyond food delivery. The acquisition will enable Zomato to integrate ticketing services with its food delivery and dining platforms, positioning itself as a one-stop platform for consumers looking to enjoy a night out. This move could potentially challenge BookMyShow's dominance in the ticketing market.
The acquisition is Zomato's second-largest purchase, following its acquisition of quick commerce platform Blinkit in 2021, which was an all-stock deal worth Rs 4,447 crore. In June, Zomato had confirmed that it was in discussions with Paytm for acquiring its movies and ticketing business. Paytm built its entertainment ticketing business from the ground up, acquiring TicketNew and Insider for a total consideration of Rs 268 crore from 2017 to 2018. The company built the entertainment ticketing business to revenues of Rs 297 crore and Adjusted EBITDA of Rs 29 crores in FY24.
A Paytm spokesperson said, "This move allows us to continue focusing on long-term growth in our core areas and value creation for all stakeholders." The spokesperson added that they built the entertainment ticketing business by addressing the market needs of the time. In addition to the sale of its entertainment ticketing business, Paytm has also proposed to trim the salary of its board members and cap annual pay at ₹48 lakh. This move is aligned with the company's efforts towards responsible financial discipline and corporate governance. The new remuneration framework, which is subject to the approval from shareholders, proposes to cap the annual compensation of each non-executive independent director at ₹48 lakh, with a fixed component of ₹20 lakh.
