Grofers becomes a unicorn after Zomato reportedly invests $120 million

• Zomato was reportedly looking to acquire Grofers last year, but the talks fell through.
• The deal values Grofers at a little over $1 billion, but the company has refused to comment on it.
• Last week, Grofer’s cofounder Saurabh Kumar had announced his exit from the company.

Gurugram-based grocery delivery startup Grofers has reportedly entered the unicorn club, after raising $120 million from IPO-bound food delivery platform Zomato. The duo has reportedly signed a deal on Tuesday, valuing Grofers at a little over a billion dollars. A unicorn is a private company valued at or more than $1 billion.

The development was first reported by Moneycontrol, quoting sources it didn’t name.

Grofers refused to comment on the speculation. “Our focus at present is to do our best to serve consumers at this time of the country's need; while we continue to build technology that empowers the grocery ecosystem to make products more affordable and accessible for millions of Indian households,” the company told MoneyControl.

Zomato did not respond immediately when Business Insider reached out for comments. We will be updating the story if and when we receive a response.

Notably, Zomato reportedly tried to acquire Grofers last year, in order to expand its presence in the groceries delivery segment, but the talks fell through.

According to stock broking house Motilal Oswal’s latest report on the retail segment, the online grocery segment has grown about 30 times over the last seven to eight years to reach $3 billion.

The report notes that India has about 154 million transacting households. Of which, 130 million are already using online grocery solutions, creating an addressable market of $293 billion.

The development comes only a week after Grofers’ cofounder Saurabh Kumar announced his exit from the company. He will continue to be a shareholder and a board member in the eight year-old company.

Kumar had founded Grofers in 2013 along with Albinder Dhindsa. The duo currently owns less than 8% stake in the company, as per the Moneycontrol report, with SoftBank being a majority stakeholder.

Grofers has, so far, raised close to $662 million across equity and debt rounds. Its investors include Sequoia Capital India, Trifecta Capital Advisors, SoftBank Vision Fund, Abu Dhabi Capital Group as well as Bennett Coleman and Co ltd.

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