Zomato got shareholder approval to expand its employee stock option plan (Esop), the food delivery firm shared via an official filing with the stock exchanges. The quick commerce firm earlier on May 13, 2024, recommended a new Esop pool for 2024 and issue of 183 million shares.
In the voting that took place on June 29, more than 75 per cent of the firm’s shareholders took part in the vote and approved the Esop plan, the company announced on Monday, reported The Economic Times.
During the Esop recommendation time, Deepinder Goyal, founder and CEO, Zomato informed that once it goes through, the Esop would result in a dilution of a 2 per cent stake in the firm for its existing shareholders.
Goyal earlier informed that the new pool would be sufficient for the next five years. Notably, firms issue equity to employees to bring in and sustain talent, align their goals with the shareholders, and promote overall performance of the employees.
In the letter, Goyal earlier noted that Esops remain crucial to develop a long-term culture which focused on innovation and cultivated a ‘founder mindset’ amongst the senior personnel. This helps bring out the correct results for long-term shareholder value creation, he said.
Amongst the delivery firm’s institutional investors, more than 67 per cent voiced their agreement with the new Esop plan,however, some also expressed their disagreement with it.
Nearly 72 per cent of the stake in the firm is held by funds such as Fidelity, Temasek, Axis, Kotak, and Vanguard.
About 100 per cent of the non-institutional investors that hold 28 per cent of the company agreed with the plan. These investors included early backer Sanjeev Bikhchandani’s Info Edge, retail investors, and Goyal.
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The company’s cost from the current Esop plan nearly doubled to Rs 161 crore in the quarter ended March 31, on a year-on-year (YoY) basis.