Zomato may extend a $75-$100 million loan to rescue cash-strapped Blinkit

Food delivery platform Zomato may extend a $75-$100 million loan to rescue cash-strapped quick commerce startup Blinkit, persons familiar with the development said. The lifeline comes at a time when the startup has laid off employees, shuttered dark stores, and delayed some vendor payments, amid intense competition in the quick commerce space.

Zomato last invested $100 million in Blinkit (previously Grofers) for a 10 percent stake at a valuation of a billion dollars just before its initial public offering in July last year. While Blinkit was supposed to raise a further $500 million from Zomato, this hasn't materialised due to current market conditions, where new-age tech stocks have been hammered. Sources say the $100 million debt will help Blinkit tide over liquidity issues, paving way for an eventual acquisition by Zomato.

Blinkit has also been in talks with a bunch of venture debt firms to raise money and recently signed a term sheet with Innoven Capital for debt worth $10 million, according to people familiar with the matter. The money from Innoven is expected to come in three tranches with the company receiving a few crores last month.

Most of the layoffs by Blinkit have happened in cities like Mumbai, Hyderabad and Kolkata across segments such as riders, pickers and store managers. The company currently has over 2,000 people on its payroll and 30,000 ground staff. This layoff is likely to have impacted close to 5 percent of the overall strength.