For those who own employee stock ownership plans (ESOPs) of Swiggy, there is good news. The food delivery company has received approval from the board to repurchase employee stocks worth $4 million.
This is the first time the company has received such approval in the past four years of formation and has also become the youngest startup to make the offer. The buyback programme will take place in June, said an ET report.
The development comes at a time when the food delivery company is planning to raise new investments and is in advanced talks with DST Global and other investors.
Swiggy has 3.4 per cent of the company’s stocks in the form of ESOPs and was worth $23.9 million a few months back when it raised $100 million from Naspers and Meituan at a valuation of $705 million in February.
The report added that existing employees looking to participate in the buyback offer will be able to tender up to 50 per cent of their vested options by June 1 for a repurchase.
In the past few months, the not-so valued ESOPs has suddenly gained all the value as the companies are buying it back to gain more control over the company or making secondary sale.
Late last year, Flipkart repurchased employee stock options (ESOPs) of worth $100 million from over 3,000 present and past employees, including Myntra and Jabong.
The buyback programme is the single largest liquidity providing event in India by an unlisted, private company to its ESOP holders. In the past, the Bengaluru-based company has bought ESOPs from its employees.
In January this year, the secondary sale of Paytm shares of worth $47.2 million to Canada-based VC firm Discovery Capital at a valuation of $10 billion, turned some 300 hundred former and existing Paytm employees into millionaires.