Zomato Issues Clarification On Reports Of It Moving To Multiple CEO Structure

In response to clarification sought by stock exchanges from Zomato on reports that it would be moving to a new multiple CEO structure, the foodtech startup on Thursday (August 4) said that the news reports had quoted an internal communication.

The BSE and NSE had sought clarification from Zomato on the issue. In its response, the startup said, “Zomato believes that the internal communication is not material and does not mandate any disclosure.”

Earlier this week, reports said that Zomato CEO Deepinder Goyal in an internal communication channel said that the company is planning to bring all its businesses under one umbrella with a parent company called ‘Eternal’ with multiple CEOs. 

“We are transitioning from a company where I was the CEO to a place where we will have multiple CEOs running each of our businesses – all acting as peers to each other, and working as a super team with each other towards building a single large and seamless organisation. Starting today, we are going to call this larger organisation ‘Eternal’,” the internal message reportedly said.

However, Zomato in its response to the BSE said, “The message was intended to merely communicate the vision for leadership structure of the Zomato group as it continues to grow.”

The startup added that it endeavours to maintain the highest standard of corporate governance and will make all necessary disclosures as required under applicable laws as and when necessary.

As per Moneycontrol, markets regulator Securities and Exchange Board of India (SEBI) has also asked Zomato to issue clarification on the issue. 

Earlier this week, SEBI had asked the food delivery startup to submit a response on the stock exchanges regarding concerns raised in media reports on its Blinkit acquisition.

Responding to it, Zomato said that the Blinkit deal was valued at INR 4,500 Cr, and not INR 7,500 Cr as incorrectly computed in some media reports. 

On Monday, Zomato reported nearly a 50% year-on-year (YoY) decline in its consolidated loss in Q1 FY23, while operating revenue increased 67% YoY.

Zomato shares ended Thursday’s session at INR 57.75 on the BSE, up 4.24% from the previous close.