Food delivery major Swiggy, which also owns Instamart, on Tuesday said its board has approved the sale of its stake in Roppen Transportation Services, which operates bike taxi aggregator Rapido, for a total consideration of nearly Rs 2,400 crore.
On July 31, Swiggy had said it is "actively re-evaluating" its investment in Rapido, as a potential conflict of interest may arise due to the latter's intention of entering the food delivery space.
In a regulatory filing, Swiggy informed that its Board of Directors have approved "the proposal for sale of 10 equity shares and 1,63,990 Series D Compulsorily Convertible Preference Shares ("CCPS") held by the Company in Roppen Transportation Services Pvt Ltd (Rapido) to MIH Investments One BV, a company incorporated in the Netherlands".
It further stated that the Rs 1,968 crore agreement is a strategic decision and the transaction will help to realise the investments of the company, for the benefit of the company and its shareholders.
The Purchaser and MIH India Food Holdings BV (MIFH) belong to the Prosus group and are under common control. The transaction under the share purchase agreement (SPA) is on an "arm's length" basis, Swiggy stated.
In another filing, Swiggy informed that its Board has approved the proposal for sale of 35,958 Series D Compulsorily Convertible Preference Shares (CCPS) held in Roppen Transportation Services Private Limited (Rapido) to Setu AIF Trust, a fund registered under the SEBI (Alternative Investment Funds) Regulations (Westbridge) for a consideration of Rs 431.49 crore. This is not a related party transaction.
Besides, Swiggy, in a separate filing, informed that its Board of Directors have considered and approved the sale and transfer of its quick commerce business under the brand name 'Instamart', along with all relevant assets, liabilities, etc. of the company to Swiggy Instamart Private Limited, an indirect step-down wholly-owned subsidiary incorporated in India, as a going concern through a slump sale.
The proposed transfer is subject to the approval of the shareholders.
"The proposed transfer is aimed at developing a focused, efficient, and strategically aligned corporate entity for the long-term development and performance of the Instamart business along with enhanced flexibility in deployment of resources," Swiggy said.
The revenue of the Instamart undertaking for FY 2024-2025 is Rs 21,295.84 million, representing 24.21 per cent of the revenue of the Company on a standalone basis.
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