Indian milk delivery vertical that has seen around USD 25 million in funding so far, is on its way to consolidation as bigger online grocery companies see value in acquiring these startups, many of which are ailing due to lack of fund.
Alibaba-backed Bigbasket is in advanced talks to acquire four-year-old milk delivery company DailyNinja for an estimated USD 20 to 25 million in a cash and equity deal, as disclosed by sources in the know to local media Entrackr.
“About 20% of the total deal size would be in cash and the transaction would be completed in a few weeks and is likely to get announced by early next month,” sources told Entrackr. Bigbasket expects to optimize DailyNinja’s core-competencies to bolster its BBDaily service which makes deliveries of daily essentials like milk, groceries, fruits, and vegetables.
Backed by Matrix Partners, Sequoia Capital, and Saama Capital, DailyNinja has raised about USD 10 million until now.
This is not the first time Bigbasket has shown interest in acquiring startups that are into daily essential products. It had previously acquired Pune-based RainCan and Bengaluru-based Morningcart for augmenting its morning delivery service.
DailyNinja last raised an undisclosed sum of money in September last year and has since been in talks to raise a new round of USD 20 million. Other milk and hyperlocal delivery startups are either shutting down, merging or are looking for a buyer. While Gurugram-based Milkbasket is trimming down operations in certain localities of Bengaluru and Delhi-NCR, another milk delivery company Doodhwala shutdown operations this year and sold its business to Bengaluru-based online marketplace FreshToHome.
Although, small players in milk and daily essentials space are seeing consolidation, the next level of competition will start brewing between bigger companies. Food delivery company Swiggy entered milk, fresh vegetables and fruits delivery segment earlier this year. Swiggy said it will invest USD 100 million in this space after it reportedly acquired another milk delivery startup Supr last year.