 "Askme freezes salaries & vendor dues")
It sent out emails, copies of which have been reviewed by Business Standard, to both sets of people telling them that the company has run out of funds and its majority shareholder, Astro Overseas Limited, has refused to fund the latest tranche, which was to land on July 31.
The company encouraged vendors and employees to write and call those at leadership positions at Malaysia-based Astro and demand that the money be paid to Askme, which employs about 2,000.
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“Employees have questioned why must they write to Astro. Their employers are Getit not Astro. It is Getit who should pay them,” said an executive who got one of these emails. A few of them have resigned, it is learnt. Getit has purchased AskMe in 2013. Getit did not comment. In an emailed reply, the Malaysia-based venture capitalist said, "Astro Overseas Limited is unable to identify or validate the contents of the letter in question, and so we are unable to comment on this."
There is visible discord in the company’s offices, sources said. Most employees in the Mumbai office, a source said, have been looking for other job opportunities and waiting for the salaries to land. “Askme has not even paid the full and final settlements of employees who were asked to resign in February,” said another executive.
This is not the first time Askme is facing a fund crunch. Around two months ago, vendors had rallied against Askme demanding payment of dues. “A few had started calling the office every day. These were primarily grocery vendors who had not received their dues and threatened to stop supply,” said a senior executive. Subsequently, Askme paid off the dues.
Problems started at Askme when it tried to raise cash in February. Askme was close to raising $200 million from various investors at a valuation of $1 billion.
Sources said it had approached Alibaba in the hope that the Jack Ma-led company would use Getit as a vehicle to launch its India operations. But the Chinese e-commerce major rejected the offer. After this, the company was forced to ask 450 to resign. Then things got even tougher.
Sources said Askme, driven by Astro, tried to sell itself off to several e-commerce majors for as little as $50 million. “All Astro wanted was an exit,” said an executive.
A highly placed executive said the emails were a last-ditch effort to put pressure on Astro to pay the money. Getit is still in discussion to get Astro to pay the latest tranche.