OfBusiness: Zodius leaves OfBusiness with more than $100 million; The Z47 can also be sold partially

business has seen a sale of secondary shares of around $100-120 million with the initial investor Capital Zodio making a complete exit from the business-to-business (B2B) e-commerce company, people familiar with the matter said.

This would likely be the second-largest secondary deal in the new-age sector this year after a $200 million Lenskart stake sale.

Zodius Capital has made more than $100 million in returns on its initial $8 million investment in OfBusiness in late 2016, Gautam Patel, co-founder of the venture capital fund, said, confirming the exit. He is also founder and managing partner of the venture fund Z3Partners.

Zodius had made its first investment in OfBusiness at a valuation of $50 million. Zodius was acquired by KKR-backed Avendus Capital in 2017.

“In recent months, Zodius has completely withdrawn from OfBusiness. “This is one of the biggest results for them from early investment,” said a person familiar with the matter.

Zodius stake was largely sold to a group of high net worth individuals (HNIs) and family offices, sources said.

Z47 (formerly Matrix India Partners), an early investor in SoftBank-backed OfBusiness, is also looking to sell its stake worth at least $50-60 million, people in the know said. The venture fund, which owns a 0.8% stake as per Tracxn data, is in talks with multiple secondaries-focused funds such as TR Capital and Oister Tribe Ace Fund to sell its stake in the Gurgaon-based company that owns plans for a IPO next year.Z47 is also in the market to sell stakes in several of its portfolio companies, including fintech Razorpay, mobility startup Ola, content aggregation platform Dailyhunt, among others. as first reported by ET on October 10.

For OfBusiness, whose latest deal was valued at $5 billion, the latest deal closed at a valuation of around $4 billion, while for the Z47 transaction the valuation may rise slightly as the contours are finalized. said one of the people involved.

OfBusiness CEO Asish Mohapatra declined to comment on the secondary share sale. Z47, TR Capital and Oister Tribe Ace Fund did not respond to ET’s emails seeking comment.

Oister Tribe Ace Fund is a deal-focused secondary fund recently created with Oister Global, which has backed private market funds in venture capital, growth equity and private equity, and the Indian arm of the Silicon Valley venture capital firm , Tribe Capital, which has invested in fintech. Jar, logistics startup Shiprocket and others.

These transactions come as the company has also confirmed its plans to go public. A Reuters report, citing OfBusiness Chief Financial Officer Bhavesh Keswani, said last month that the company intends to launch an initial public offering of between $750 million and $1 billion.

New AI company?

Meanwhile, one of the company’s co-founders, Nitin Jain, is exploring the possibility of creating a new company in the artificial intelligence space, even as discussions are underway about his role at OfBusiness as he has held talks with investors about the new startup idea, people familiar with the matter said.

Both Mohapatra and Jain said they are likely to invest in the new AI startup, but Jain will not leave OfBusiness, which is also backed by Alpha Wave Global.

Industry sources said Jain has been meeting investors to discuss possible launch plans and financing needs. Ruchi Kalra, Vasant Sridhar and Bhuvan Gupta are the other co-founders of OfBusiness.

The company posted a 30% rise in consolidated net profit in FY24 to nearly Rs 603 crore as compared to Rs 463.25 crore in the previous fiscal. Operating income grew 26% to Rs 19,296.27 crore.

OfBusiness has made as many as 19 acquisitions in the last two years in sectors such as steel, agricultural products, metals and manufacturing.

oxyzothe lending arm of OfBusiness, was spun off in March 2022 and raised external financing of $200 million from global tigerAlpha Wave Global and Matrix Partners India with a valuation of over $1 billion. OfBusiness owns around 70% of Oxyzo, run by Kalra.

This unit recorded Rs 903 crore in operating income for FY24, up 59% year-on-year. Its net profit rose 47% to Rs 290 crore, from Rs 197 crore in FY23.