Udaan to acquire Swiggy’s LYNK Logistics in ₹500 crore deal

The acquisition will strengthen Udaan’s retail distribution network across key Indian markets, while Swiggy will receive an equity stake in Udaan’s parent and make an additional investment as the B2B platform advances its profitability and public-market ambitions.

Bengaluru-based B2B commerce company Udaan has agreed to acquire LYNK Logistics, the retail distribution arm of food delivery company Swiggy, for ₹500 crore. The transaction is expected to expand Udaan’s presence in retail distribution while adding new brand partnerships and retailer networks to its existing B2B commerce operations.

Under the proposed structure, Udaan’s parent company, Trustroot Internet, will issue preference equity shares to Swiggy. Following the transaction, Swiggy is expected to hold around 2.8% in Udaan. In a separate transaction, Swiggy will invest another ₹75 crore in Trustroot, giving it an additional stake of approximately 0.4% in Udaan.

LYNK adds distribution reach

LYNK operates as a technology-enabled retail distribution platform, connecting consumer brands with retailers across multiple markets. Udaan said bringing the business into its platform will add complementary capabilities, strengthen relationships with brands and broaden its reach among retailers.

The four cities of Bengaluru, Hyderabad, Chennai and Kolkata contribute nearly three-fourths of LYNK’s revenue. Udaan expects this geographic concentration to deepen its presence in these important markets and complement its cluster-based operating model.

The transaction also comes as Udaan continues to improve its financial performance. The company recently completed a $160 million recapitalisation involving fresh equity, new debt and conversion of debt into equity. The exercise was backed by Lightspeed Venture Partners, M&G Investments and Moonstone Capital, alongside around $45 million in private credit financing from a global investment management firm.

“Bringing LYNK together with udaan, the market leader, combines complementary capabilities with udaan's scale and technology-led platform serving India's retail ecosystem,” Rahul Bothra, CFO, Swiggy, said.

Focus on profitability and scale

LYNK became part of Swiggy in 2023 through a share-swap transaction, marking the food delivery company’s expansion into the retail distribution segment. The proposed sale now comes as Udaan seeks to build scale while improving its operating metrics ahead of potential public-market plans.

Udaan said its revenue increased at a 25% compound annual growth rate between Q4 CY23 and Q1 CY26. During the same period, its contribution margin improved by nearly 500 basis points, while EBITDA burn fell by about 70%.

The company has also been increasing its focus on higher-margin categories. Its private-label products currently contribute between 15% and 25% of Staples sales across its operating cities. Bengaluru, meanwhile, has reached EBITDA profitability and remains Udaan’s largest operating market.

“This deal is a strong endorsement of the huge eB2B opportunity and the progress udaan has made in building an efficient and sustainable business,” Vaibhav Gupta, co-founder and CEO, Udaan, said.

Udaan said the LYNK transaction is subject to customary closing conditions and applicable regulatory approvals. Kotak Investment Banking served as financial adviser to Udaan for the deal.