Dutch investment giant Prosus is set to infuse a total of around $350 million (Rs 3,000-3,100 crore) in ride-hailing firm Rapido as it deepens its conviction in the company’s growth potential, according to people familiar with the development.
The proposed infusion represents a significant increase of nearly 50 per cent from Prosus’ earlier commitment of $200 million, first reported by Moneycontrol.
Prosus, already a stakeholder in Rapido, plans to structure the transaction as a combination of primary capital infusion and secondary share acquisition. While the primary funds will bolster Rapido’s balance sheet to support accelerated expansion, a substantial portion of the investment will come from purchasing shares from existing investors.
As part of the deal, Prosus is expected to acquire Rapido shares valued at approximately Rs 1,968 crore ($223 million) following Swiggy’s complete exit from the startup - a move designed to mitigate potential conflicts of interest, given that both Prosus and Accel are major backers of Swiggy. Plus, Rapido recently launched Ownly, a food delivery app that will compete with Swiggy and Zomato.
In addition to the secondary purchase, Prosus will provide roughly $125 million in fresh capital to fuel Rapido’s operational scale-up, sources said. The deal is expected to close in the coming weeks.
Accel, another early investor in Swiggy, is also in advanced discussions to participate in the funding round via its growth fund, sources told Moneycontrol.
How much does Prosus own in Rapido and how much will the ownership increase to?
Prosus currently owns 6-6.5 percent of Rapido and will likely increase its ownership to around 15 percent after the current round. It will become one of the largest shareholders of the company after Westbridge which will own around 25 percent of the company in the coming weeks.
Who else will invest along with Prosus?
The round at Rapido is set to be one of the largest for an Indian startup so far this year. In addition to Prosus putting in around $350 million, Westbridge Capital will also pick up shares worth $49 million in Rapido.
At the same time, “Accel is also in advanced stages of infusing capital into Rapido,” one of the persons cited above told Moneycontrol.
Interestingly, Accel is also a key Swiggy shareholder, along with Prosus. While Swiggy has sold its entire 12 percent stake in Rapido to avoid any conflict of interest, early backers of the food delivery giant are looking to replicate the success they tasted with Swiggy by backing Rapido.
As it happens, Accel’s Anand Daniel gave up his seat on the Swiggy board last month.
Cumulatively, the total round size, including the primary component and secondary share sales, is likely to be one of the largest so far this year, as it exceeds $400 million, with more inbound interest coming in.
What makes Rapido so attractive?
Apart from beating Uber and Ola on monthly transacting users (MTUs), Rapido has quickly scaled and now has a gross merchandise value of $2.3 billion, similar to that of Uber in India.
While it has dominated the ride-hailing market, Rapido is now preparing to break the duopoly that Swiggy and Zomato have enjoyed in the food delivery market. It launched Ownly to fundamentally change how food delivery works in India.
What is Rapido’s valuation?
While Rapido is valued at around $2.3 billion during the ongoing secondary share sales, the company is commanding a valuation of around $2.5-2.7 billion, as per sources. That is a sharp increase from the $1.1 billion valuation it had last year.
This will be the second large fundraise at Rapido, which raised around $250 million in December 2024. The company has so far raised over $550 million since its inception in 2015.
Prosus, Accel and Rapido did not respond to Moneycontrol's queries.
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