Anger is the biggest enemy of a person! And no one better than Ashneer Grover, co-founder – BharatPe, the fintech startup, can tell you about this in recent time.
Despite all the corrective measures being taken by him after the recent debacle with Kotak Mahindra Bank, it appears that the management of BharatPe continues to tighten the noose around him, forcing him to explore legal options.
Ashneer Grover (BharatPe’s co-founder and managing director) is looking for legal assistance amid increasing pressure to leave the company, multiple people with knowledge said.
Grover has hired Karanjawala & Co., a New Delhi-based law firm. They are working closely with Grover to protect his position and preserve his roughly 9% share in the fintech startup, valued at $2.85 billion.
He did this at a moment when he is under immense pressure from the BharatPe board members and investors, who called for an independent audit and investigation into the company, especially to screen the functioning of the company tenure of Ashneer Grover. The media companies have reported that suspecting his ouster following the investigation Grover has been arming itself with all the legal ammunition to counter the board.
“He (Grover) has begun conversations with Karanjawala as of now and is exploring his legal options against a potential ouster from BharatPe,” reports ET citing an unknown source.
Grover is seeking legal advice on all possible outcomes and circumstances, including any allegations of fraudulent transactions at BharatPe.
BharatPe released a statement on Saturday, stating that it is carrying out an investigation and audit of BharatPe, with a new twist about alleged financial irregularities at the company.
Quite recently Ashneer Grover and his wife, Madhuri Jain, who also holds a senior executive position in the company, abruptly went on indefinite leave after the leak of alleged audiotape which left the due in a very humiliating situation. Reacting to reports that Grover was fired, the board stated that no employee had been terminated.
BharatPe board has appointed Alvarez & Marsal, which is a well-known risk advisory and management consulting firm, to audit the company and make recommendations to the board.
According to a person familiar with the details, these charges involve financial irregularities, including multiple discrepancies in invoicing, payments for QR code fleet, and related-party transactions that result in a conflict of interest. The audit will determine the extent and nature of these irregularities. Grover is not the only one being scanned. Madhuri, Madhuri’s wife, is also being inspected.
The board would take action based on the audit report’s findings.
A person familiar with the matter stated that it would be crucial to determine if the irregularities were “premeditated” or for anyone to be fired. It is unclear when Alavarez & Marsal will submit their report.
Grover is currently on voluntary leave until the end of March. Earlier he stated that he would return to the company by April 1st.
The trouble started for Grover and his wife after an audiotape was leaked in which the duo was found using very abusive language and inappropriate behavior against a Kotak Mahindra Bank employee. Grover, however, was quick to call that audiotape fake, but later deleted his tweet meant to defend himself. Grover found no support from the fintech’s board or investors on the audiotape after Kotak spilled more beans in this regard.
One of the people involved believed that it was time to clean up… He explained that the decision to conduct an audit is to provide a clean slate for the company.
“Basically every stakeholder in the company is gunning for Ashneer,” he said when asked about support to Ashneer.
Previous media reports also claimed that BharatPe’s board, as well as investors such as Sequoia Capital India (which owns almost 20% of the firm), are also facing the heat for not taking action despite numerous red flags about corporate governance within the firm.
The former chairman of The State Bank of India’s Rajnish Kumar is the chairman of BharatPe board. Rahul Kishore of Coatue Management, Harshjit Setti, a managing director at Sequoia Capital India, Kewal Kundanlal Harda, former chairman, Union Bank of India, and Meyer Malka (also called Micky), of Ribbit Capital, are all part of BharatPe’s parent company Resilient Innovations.
From the latest development in the matter, it’s clear that the board of BharatPe is in no mood to give an easy pass to Ashneer and his wife this time. On the other hand, sensing tough days ahead, the duo is also not willing to give up that easily.
