Swiggy to buy back $50 million worth ESOPs from employees

Food delivery platform Swiggy announced on Monday that the company's employees will have the option to receive liquidity of up to $50 million against their ESOPs. This event will also see eligible employees from Dineout participate, even though Swiggy acquired the company just last year.

Girish Menon, Head of HR at Swiggy said after the announcement, “Two years ago, Swiggy announced a one-of-its-kind ESOP program to enable consistent wealth creation for employees through two distinct liquidity events in 2022 and 2023.”

“Our team is Swiggy's most valuable asset, and we are happy that macroeconomic conditions notwithstanding, we're able to keep our commitment of sharing Swiggy's success and growth through these wealth creation opportunities," the Head of HR added.

It is worth noting that the company did not shed light on the breakup and the price of each share.

Since 2018, the food delivery platform has bought back ESOPs four times with the size increasing each year. The company bought back shares worth $4 million in 2018, then spent $9 million in 2020. After a break of about two years, Swiggy bought back shares worth $23 million in 2022 and now it will be paying out $50 million.

It is worth noting that the company’s valuation has been marked down by multiple investors in the company. The US-based asset management company (AMC) Baron Capital reduced the valuation of the company by 34 per cent. Baron Capital estimated the fair value of its stake in Swiggy at $50.9 million, as per SEC filings. Baron Capital holds about 0.7 percent stake in Swiggy, and its fair value estimate implies a $7.3 billion valuation for the foodtech unicorn.

Before that, Invesco cut the foodtech platform’s valuation twice in the last four months, effectively bringing it to $5.5 billion.