Zomato breaks the suspense over 'merger talks' with rival Swiggy, responds to reports

Online food delivery firm Zomato has denied reports about merger talks with its rival Swiggy. Zomato clarified that the company is not in negotiations with 'anyone.' In a statement, Zomato spokesperson had this to say:

"We have tremendous focus on our business metrics and have seen great success in our goal towards profitability. We are not in talks with Swiggy for a merger or acquisition."

Earlier, there was a report that Zomato and Swiggy could merge soon amid looming threats from Amazon and UbeEats and both the companies were in a discussion over a possible merger.

READ | Zomato, Swiggy could merge ahead of Amazon's entry in online food delivery business

In 2017, both Swiggy and Zomato were reportedly involved in merger talks.

The Zomato spokesperson further said that the latest "speculation is absolutely untrue". Swiggy, however, refused to comment on the report.

While Swiggy declined to comment, Zomato spokesperson further stated that the latest "speculation is absolutely untrue."

Amazon entering India's food delivery market

Meanwhile, Amazon is gearing up to launch its own online food delivery division to compete with Swiggy, Zomato and UberEats in the Indian market.

It seems like Amazon has plans to disrupt the food retail business and gain maximum market share in the segment.

Previously, there were reports that Amazon has a reserved capital of Rs 3,500 crores to expand into online food delivery business in the country

Amazon India already has its existing workforce of delivery partners in place and the chances are that Amazon would put its current workforce of delivery partners to use in order to speed up the delivery process and stay ahead of the competition.

 As of December last year, Swiggy held almost half of the market share in terms of the number of orders, followed by Zomato and FoodPanda.

READ | Amazon Food delivery app could pose a serious threat to Zomato, Swiggy

However, if Swiggy indeed joins forces with Zomato in the future, together they will emerge as the single-largest player in terms of market share.

Of late, Amazon and UberEats seem to be doubling their investment in the India market. As a result, cash burn over at Zomato and Swiggy is expected to increase to sustain the competition.

Over the last several months, Zomato is cutting down on costs to a significant extent. Within the last few months, Zomato has also laid off around 600 employees and reduced spendings.

(With inputs from IANS)