has rejected a new valuation report by consultancy EY that lowered its stock price value for its acquisition of quick commerce startup Blinkit, according to the food delivery platform’s regulatory filing to the BSE.
Zomato bought Blinkit (formerly Grofers) for Rs 4,447 crore in an all-stock deal, which 97% of shareholders who voted approved on June 26.
Zomato’s shares were valued at Rs 70.76 in the first EY report dated June 24.
The latest EY report valued Zomato’s share price lower than Rs 70.76. The company, however, did not disclose the new share value.
Last month, the BSE and the National Stock Exchange had asked Zomato to submit another report using a different valuation methodology, its regulatory filing showed.
“Pursuant to discussions with the exchanges, and to comply with the request of the exchanges, we wish to state that the new report was placed before the Board on August 4, 2022, and after evaluating the price of the equity shares from the original report and new report, the board has concluded that the fair market value per equity share of the company would remain unchanged at Rs 70.76 per share, which is the issue price disclosed to the shareholders in the notice,” the BSE disclosure showed.
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Zomato has addressed investor concerns regarding its valuation of Blinkit in its latest quarterly report.
“We objectively evaluated all available acquisition opportunities in the quick commerce space, and after zeroing in on Blinkit, we ensured that rigorous and detailed due diligence, deliberations and negotiations were done before agreeing to the terms of the transaction (like any other company would do for a large and important transaction),” Deepinder Goyal, CEO of Zomato, wrote in a shareholders’ letter filed to the BSE earlier this week.
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