Zepto pursues talks to raise structured debt

Quick commerce business Zepto’s founders Aadit Palicha and Kaivalya Vohra are holding talks with Edelweiss Alternative Asset and other investors with a view to raise around Rs 1,500 crore in structured debt as the business moves towards its initial public offering. 

“Edelweiss has given a binding term sheet and will anchor the raise by committing half of the amount,” an anonymous source close to the development told ET Tech. “The remaining Rs 750 crore is being raised from family offices and smaller credit funds, who are expected to come in on the same terms.”

Zepto is gearing up to launch its IPO in India and this deal is designed to enable Indian businesses to acquire shares from foreign shareholders in order to boost domestic ownership of the company. The proposed loan from Edelweiss has a minimum interest rate of 16% and an equity linked upside which has the capacity to enhance total returns by approximately 18%, ET Retail reported. 

Zepto, which has a valuation of around $5 billion, expects to close the deal by July this year. The business aims to fit the criteria of ‘Indian Owned and Controlled Companies,’ which requires that it must be more than 50% Indian owned.