The Competition Commission of India (CCI) has reportedly sanctioned SoftBank’s investment in Swiggy. This investment will be made through the SoftBank Vision Fund II.
The Japanese multinational conglomerate had apparently revealed plans to invest around USD 450 million to USD 500 million in the food delivery platform in April, taking the company’s valuation close to USD 5.5 billion.
This investment comes after Swiggy recently closed a Series J funding round of USD 800 million. This round was initiated by Falcon Edge, Think Investments, Amansa, Goldman Sachs, and Carmignac at USD 5 billion valuation.
Over USD 1.2 billion of funds were raised by Swiggy, thereby giving it substantial growth momentum at a time when competitor Zomato is looking to go public.
SoftBank has been taking an interest in the Indian food-tech sector for a long time. Over the years, it was speculative as to who among Zomato or Swiggy might receive the financial assistance. After acquiring UberEats a few years ago, Zomato seemed to be in a favorable position.
UberEats was the subsidiary of Uber, the company under the portfolio of SoftBank, which obtained a stake in the merged entity. Alibaba’s Ant Financial, another portfolio company of SoftBank, is also an investor in Zomato.
Although Zomato is concentrated on the food delivery segment, it recently invested around USD 100 million in Grofers, a grocery delivery app. Likewise, along with food delivery, Swiggy is investing in its hyperlocal delivery service Swiggy Genie., where Flipkart and Dunzo are its competitors.
Swiggy’s online grocery service Swiggy Instamart is a direct competitor to BigBasket, Grofers, JioMart, Amazon, and Flipkart. The Genie service is currently available across 65 cities, but the grocery delivery started with Bengaluru and Gurugram.
It is also interesting to note that the current lead in investments for SoftBank in India, Sumer Juneja, previously held a seat on Swiggy’s board when he worked at Norwest Venture Partners, one of the early investors of Swiggy.