After foodtech major Swiggy acquired Mumbai-based Scootsy for Rs 50 crore, there are reports suggesting that FoodPanda, owned by cab aggregator Ola is in the final leg of acquiring cloud kitchen startup Holachef, according to an Economic Times report.
The deal to acquire Holachef is yet to be concluded but it is learnt it is a done deal. Unlike Scootsy, Holachef reportedly shut operations about 3 months back, since it could not find investors to funds its cash requirements. Scootsy is also changing hands following the failure to raise funds to run on its own.
While Scootsy may continue to operate in its own name, at least for the time being. At Holachef, the situation is reportedly is quite grim and Poodpanda may have to adopt a more hands-on approach there and place its executives to pull the startup out of the deep and make it operational.
Holachef’s founding team is likely to join Foodpanda’s management team and the proceed from the acquisition will be used by Holachef to clear dues and absorb some of the staff.
ET reports that the fire sale of Holachef may not bring any returns to its investors. Kalaari Capital and India Quotient resigned from the board of directors of cloud kitchen player over six months ago.
On the other hand, for Foodpanda, Holachef’s brand name may help it start a cloud kitchen play, which has seen adoption among several foodtech majors.
In the case of Swiggy’s acquisition, Scootsy has a limited area of operation in South Mumbai and it uses 700 delivery agents to fulfill orders. Its 2000 orders a day comprise food as well as non-food daily essentials. It can be termed a premium service based on the client profile it enjoys.
Swiggy will consider the Rs 50 crore well-spent since it may feel it has scored a point over arch rival Zomato in making an expansion in a high-profile market like Mumbai. More importantly, there is some value addition; Scootsy’s average order value is in the region of Rs 750, whereas Swiggy ‘s figure is just Rs 350. But in the long run its desire to have a hyperlocal delivery segment as part of its portfolio will also get fulfilled.