Dineout will continue to operate as an independent app after the acquisition, Swiggy said in a statement on Friday.
The largely all-stock deal is worth about $120 million, or about Rs 930 crore, and is expected to close over the course of the next month, multiple people aware of the discussions told ET.
“The acquisition will allow Swiggy to explore synergies and offer new experiences in a high-use category,” said Sriharsha Majety, cofounder and chief executive officer of Swiggy.
Swiggy is expected to double down on Dineout’s offerings, including table reservations and events while Dineout’s restaurant partners will get access to Swiggy’s large customer base, allowing them to increase their reach.
Ankit Mehrotra, cofounder and CEO of Dineout, said Swiggy currently lacked a dining out vertical, “which we will now integrate and build”.
Discover the stories of your interest
Swiggy’s rival had started off as a table reservation platform and continues to operate that business.
Founded in 2012 by Mehrotra, Nikhil Bakshi, Sahil Jain and Vivek Kapoor, Dineout allows customers to discover restaurants in their areas, and make table reservations across its network of 50,000 restaurants in 20 cities.
It also provides restaurant solutions with regards to contactless dining besides discounts and privileges to customers across select restaurants through Dineout Passport and Dineout Pay.
In 2014, Dineout was acquired by Times Internet, digital media arm of Bennett, Coleman and Company Ltd (Times Group) that publishes ET.
At present, Dineout has close to 5 million users while Swiggy has over 50 million active annual transacting users, sources cited above said.
The companies will focus on integrating Dineout’s offerings onto the Swiggy app over the next 12 months. Moving forward, Swiggy will also integrate its loyalty programme with Dineout Passport to create one strong subscription for customers. It will also integrate its wallet with Dineout Pay, they told ET.
Swiggy will be able to use Dineout’s software solutions for restaurants, which is spread across domains of marketing and payments. It will also benefit from Dineout’s events business as it looks to increase its revenue streams.
“Dineout is a well-loved brand that enjoys loyalty from both consumers and restaurants,” Majety said. “Times Internet and the founding team should be credited for the transformational impact they have brought about in the dining out experience through their products, technology, and vast selection of restaurant partners.”
Dineout’s Mehrotra said Swiggy’s large user base will help fuel its next phase of growth. “We have had a strong bounce back from Covid, and our numbers are starting to surpass pre-Covid levels, leading us to explore much bigger opportunities,” he told ET in an interaction.
Currently, Swiggy has a network of 190,000 restaurant partners and stores in over 520 cities. Over the last two years, it has expanded Instamart, its quick commerce grocery delivery to 28 cities.
On May 10,
ET reported that Swiggy had temporarily shut its pick-up and drop-off service Genie across major metros as the company struggles to hire a delivery workforce and keep up with the demand.
Swiggy led an investment of $180 million in bike and auto-taxi aggregator Rapido. The food-delivery platform also invested in restaurant management company UrbanPiper in April.