Zomato has agreed to acquire instant grocery start-up Blinkit, formerly known as Grofers, for Rs. 4,447 crores (about $570 million) in all-stock deal. However, the deal value is nearly 40% lower than the blinkit's $1 billion valuation last year, when it turned unicorn by raising $120 million funding from Zomato and New York based investment firm tiger global. Post the board meeting, Zomato informed BSE that the transaction is expected to close by August 2022.

Zomato's board at the meeting said that the they have approved the acquisition of 33,018 equity shares of Blink Commerce Pvt. Ltd. (formerly known as Grofers India Private Limited) at a price of Rs. 13.45 Lakh per equity share. The total valuation of this acquisition is Rs. 4,447.48 Crores. Currently, Zomato holds approximately 9% stake in Blinkit.

Commenting on signing the deal to acquire Blinkit, Deepinder Goyal, CEO, Zomato said, "This foray into the next big category is timely as Zomato's existing food business is steadily growing towards profitability."

As per the deal, the shareholders of Blinkit will get 7% in Zomato. The transaction will be carried out by issuance and allotment of up to 62.85 crore fully paid-up equity shares of Zomato having a face value of Rs 1 each at a price of Rs 70.76 per equity share.

Blinkit has raised $692 million so far from its investors which includes Japan based SoftBank, DST Global and Tiger Global. Zomato already holds one equity share and 3,248 preference shares, or 9% stake, in Blink Commerce Pvt. Ltd.

"Quick commerce has been our stated strategic priority since the last one year. We have seen this industry grow rapidly both in India and globally, as customers have found great value in quick delivery of groceries and other essentials. This business is also synergistic with our core food business, giving Zomato the right to win in the long term," Zomato told shareholders.