Ashneer Grover saga is far from over, and it appears that neither Ashneer nor the management of BharatPe is ready to retreat.
In the latest development, BharatPe founder and director Ashneer Grover has filed an arbitration complaint with the Singapore International Arbitration Centre (SIAC) asserting that the investigation conducted by the company against him is unlawful.
“Ashneer’s claim is that the Alvarez & Marsal report and preliminary investigation is inadmissible because it violated shareholder agreements and article of agreement. Ashneer’s claim is that the company does not have the authority to conduct an investigation like this,” LiveMint reports citing the person directly aware of the matter.
In his plea, he accused BharatPe of giving deaf ears to his numerous objections and not refraining from following opaque process. He alleged that the fintech company accepted the review and assessment by the review committee and gave him no chance to present his case.
“The reviewing committee was established in violation of the provisions of SHA (shareholders agreement) and continues to perform its duties to the disadvantage of the plaintiff (Grover). The plaintiff is at risk of suffering severe prejudice if the work by the committee isn’t stopped and is likely to be irreparably damaged and hurt,” Grover said in the plea.
Undoubtedly, Grover desperately wants that the company must stop the investigation that is being conducted by the committee.
Grover has sought that the current review panel must be disbanded, and a new lawful panel to oversee and conduct an all-encompassing examination of the operations of BharatPe must be formed instead.
Grover also wants that an order must be issued to instruct BharatPe not to depend on reports of the review committee as they are in their present form and constitution, or on reports made by any entity or person that are appointed at the direction of members of the review panel.
The first hearing took place on February 20th. Grover was represented by Karanjawala & Co., while BharatPe is represented by the senior attorney Abhishek Singhvi.
In the petition, Grover is also seeking interim relief. One of the requests is specifically to Suhail Sameer, chief executive of BharatPe. Grovers wants that Sunil’s appointment as director must be suspended, and strip him off with all the powers of a director.
In an earlier statement made this month, Grover called for the removal of Sameer. However, Grover can’t execute the order alone and the removal from the position of CEO as director will require approval by Grover’s co-founder Shashvat Nakrani.
Experts believe that Grover’s demand will not hold for long in any court of law. A board of a company is powerful enough to initiate an investigation on any matter, and no one can raise an objection to it, explains Fereshte Sethna, senior partner of DMD Advocates.
Another expert sees Grover’s move as a pressure tactic and an attempt to achieve short-term strategic pushback. However, he also believes that without convincing reasons, it might not be able to stand the outcome of the investigation.
As the legal battle got more intense, Grover and BharatPe have held talks for settlement over the terms of Grover’s exit, reports Mint.
Few media reports have claimed that BharatPe has already provided an option to settle the issue, on which Grover’s response is awaited. Since BharatPe has an edge, the company isn’t required to follow the settlement route. However, the company wants to move on from the issue which is constantly attractive bad PR. Besides, following the legal route to settle the matter is a lengthy process and may drag for months giving enough feed for media to keep highlighting the issue that neither the management nor investors of BharatPe would like to be discussed.
Earlier, we reported that Grover insisted on taking an exit route but on his own terms. He demanded the board to pay Rs 4,000 crore in exchange for his 9.5% stake in BharatPe, valuing the company worth nearly $6 billion. Barely a few months ago, the company raised investment at a valuation of $2.8 billion.
The company is unlikely to opt for an all-cash settlement option given by Grover. BharatPe may let Grover have his stake in the company but won’t give any cash.
The company is slowly making careful moves, including bringing in PwC, to push Grover and his Wife Madhuri Jain to exit.