B2B Unicorn Udaan Lands $160 Mn in Fresh Funding Package

The funding round will include investments from existing investors as well as a new investor. This will provide Udaan with additional capital to support its growth.

As part of the deal, some bondholders will convert part of their debt into company shares, while the remaining debt will be extended under new terms. This will help simplify Udaan's capital structure and strengthen its balance sheet.

“This financing round marks another milestone in Udaan’s journey towards building a sustainable, profitable and institutionally resilient business,” said Vaibhav Gupta, cofounder and chief executive officer of Udaan. “Over the last several quarters, we have consistently improved our operating performance by delivering healthy growth while significantly strengthening profitability and cash efficiency. With a stronger balance sheet and a simpler capital structure, we are well positioned to continue investing in customer value, deepening our market leadership and progressing towards our long-term public market ambitions."

Udaan said that one of the world's leading investment management firms has committed around $45 million through its private credit platform as part of the financing deal. However, the company has not revealed the investor's name or when the transaction will be completed.

The funding comes at an important time for the Bengaluru-based startup. Earlier this month, creditors started insolvency proceedings against Udaan's Singapore-based parent company after it failed to repay nearly $170 million in convertible notes that matured on June 30.

Udaan clarified that the legal proceedings only involve its offshore holding company and do not affect its operations in India. The new funding will help the company restructure its debt, improve its financial position, and resolve issues related to the legal process.

The company said the financing will strengthen its balance sheet, simplify its capital structure, and prepare it for a future public listing (IPO).

In recent years, Udaan has focused on improving profitability by reducing costs and discounts while giving priority to high-demand categories such as FMCG. It has also expanded its logistics, fintech, and retail technology businesses to create new revenue sources and improve profit margins.

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