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Zomato’s problems compound as investors accuse it of failing to make “timely disclosure” on Blinkit’s acquistion

A group of investors allege that Zomato failed to announced its acquisition of Blinkit in a timely fashion.

A group of investors have accused Zomato of not making timely disclosures regarding its acquisition of Blinkit last week in a complaint to the Securities and Exchange Board of India (SEBI), Economic Times (ET) reported. The complaint alleged that the failure of timely disclosure by Zomato* resulted in losses for the investors who would have been better prepared otherwise, the report continued. https://twitter.com/anuragsingh_as/status/1541993578871889920 Why it matters: Zomato has been looking to gain a foothold in quick commerce for a while now and Blinkit is critical to its plan. The acquisition, however, did not cheer up investors as demonstrated by the free fall witnessed by the company’s stock price since the announcement. The investors and analysts worry that Zomato may find it difficult to turn a profit, thereby affecting its bottom line, in a category with cutthroat competition. What was the reason behind the letter: The investors alleged that there were rumours about Zomato’s potential acquisition of Blinkit which had been reported in the news but Zomato neither denied nor confirmed the reports. They also added that there were discussions on social media for more than a month before the deal was announced. The letter was sent to the SEBI chairman on June 29, ET revealed. When did Zomato announce the acquisition: The proposal to acquire Blinkit was uploaded on Bombay Stock Exchange’s website on June 24, 2022. Who were the investors: The report did not identify the investors nor verified the holdings of these investors but revealed that they were based out…

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