Self-drive car rental Zoomcar and Drivezy in initial talks for a merger
Zoomcar and Car and bike rental platform Drivezy are in the initial stage for an equal merger.
Drivezy has till now raised a total of $32 Million in equity financing.
The merger will come into existence only if it has sufficient money to cover debt and its repayments.
Getting cars and bikes on rent has always been a matter of concern for youths especially for working professionals. Therefore now various companies have come into market to remove this problem. Zoomarcar and drivezy are two major startups in this domain and now self-drive car rental startup Zoomcar and Car and bike rental platform Drivezy are in the initial stage for an equal merger, with a share swap deal. Both startups are in initial talks for merger and if a merger occurs then top investors in both startups are expected to hold highest stakes in the merger.
Zoomcar came into action in 2013 by American duo Greg Moran and David Back in Bengaluru. It has till now raised a total of $100 Million and assists users in booking vehicles and make payments online. Users need to locate a Zoomcar vehicle lot within their locality to pick up the vehicle. It also provides doorstep delivery of the rented vehicle. It currently has more than 7,000 cars on its platform, with an additional 300 electric vehicles. It had also earlier launched its bicycle-sharing operations named PEDL in late 2017 but suspended the operations a year later in December 2018.
Drivezy came live in August 2015 as JustRide. It offers cars and two-wheelers on rent to customers and it also offers car owners an opportunity to list their vehicles on Drivezy’s platform for customers to select for rentals. The company has till now raised a total of $32 Million in equity financing from various investors including Axan Partners, Yamaha Motor Ventures, Y Combinator, Das Capital, IT-Farm and several others.
According to Zoomcar, this merger will be done in a share-swap deal that will permit it to pay existing shareholders using equity shares, in spite of paying them the sum entirely in cash. The status related to the method of the merger is still pending from Drivezy end. The condition for the merger would be that the new ownership structure should be fine with all debt lenders and all the assets and liabilities will be put on the table. The merger will come into existence only when if there will be sufficient money to cover debt and its repayments. This merger if occurs will make the combination biggest bike and car renting platform in India and will also assist in putting acceleration in the functioning of both the firms. The collaborative team of both the firms will enhance the efficiency of individuals and can focus more on core business and spread their portfolio of services in more cities of India and also increase their revenue and market valuation and attract more and more investors on its board to gain more funds for the smooth functioning and revenue generation of the collaborative firm.
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