Zomato's CEO explains the rationale behind its acquisition of New Zealand's MenuMania

India’s largest restaurant search and discovery service, Zomato, has made its first acquisition abroad by snapping up New Zealand’s leading restaurant listing and review portal MenuMania in a bid to step up its global expansion.

While the company did not disclose the sum paid for this all-cash deal, an Economic Times report has pegged it at Rs 5 crore. However, speaking to Firstbiz, Zomato’sfounder and CEO Deepinder Goyal said this is a wrong estimation.

An eight-year oldrestaurant discovery service startedby Auckland-based techie Cristian Rosescu, MenuMania was the largest rival to Zomato, whichlaunched in New Zealand a year ago. The acquisition will now make it the largest player in the country as itwill allow it to reach more people and provide a better, more comprehensive service.

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“Together, Zomato and Menumania will be the largest resource of restaurant information in New Zealand, and I am sure both our users will love the integrated product once it rolls out over the next few weeks” said Goyal, adding that"Acquiring a local company makes it so much easier for us to grow with the help of the new team, which knows the market and everything," he said.

Zomato’s first purchase in the Pacific is a strategic move as it will allow Zomato to not only increase its user base but also generate moretraffic, content and reviews.

Explaining the rationale behind the acquisition, Goyal told Firstbiz,“We are in 3 cities in New Zealand and those guys are in 20. Though, the top four cities, make for 95 percent of the restaurant business. We don’t acquire a lot of listing from them, but we do acquire their traffic. They were almost four time ahead in traffic compared to us.”

Zomato plans to launch in a lot of markets in the future. Deepinder says there are 22 more countries to go after. The company plans to make two more acquisitions this year: one in South-East Asia and another in Europe. “We are not in these markets yet, so this will be the way how we enter these markets,” said Goyal.

Deal details:

•The Menumania website will eventually migrate to Zomato.co.nz in order to maintain a single identity.

•The current set of restaurant reviews on Menumania will be put through the Zomato review quality filters to ensure consistency in quality and authenticity

“We will be able to combine our local knowledge about the market, with the technology Zomato brings to the table. It will also deliver greater value to local restaurant businesses, as all the users in NZ will have access to their information on a common platform now. Overall, it is going to be a big win for our users, MenuMania, Zomato and business owners as well,“said Cristian Rosescu, Founder & CEO, MenuMania.

Started in 2008, Zomato has beenaggressively expanding its global presence with launches in Europe and Southeast Asia in the past six months, and is also working to strengthen its presence in existing markets. Currently the company is present in in 41 cities across India, UK, UAE, South Africa, New Zealand, Philippines, Portugal, Brazil, Turkey, Indonesia, Sri Lanka, and Qatar and receives over 20 million monthly visits globally.

Clearly, the MenuMania acquisition is only the first of more to come as it aspires to become the dominant player in this space globally. Last year itgot $37 million in funding led by Sequoia Capital in order to continue its globe-trotting.In June 2014, the company also revealed that it would invest $1 million to scale up its oprations in Scotland, with Edinburgh and Glasgow as the obvious choices to expand into.