BharatPe co-founder & MD Ashneer Grover not granted reliefs by SIAC

Grover had filed an arbitration plea to stop a probe into alleged financial mismanagement in the company, and had also sought indemnity

The Singapore International Arbitration Centre (SIAC) has refused to grant emergency relief to BharatPe Co-founder and Managing Director Ashneer Grover from a governance review being conducted by the company, according to sources.

Grover had filed an arbitration plea earlier this month to stop a probe into alleged financial mismanagement in the company. The BharatPe MD, who is on leave till March-end, is also said to be seeking indemnity against future action by the company through the plea. 

“SIAC, in the order itself has said that the question of whether the preliminary investigation’s conclusion is justifiable or not will be considered by the tribunal in due course i.e. after  the review committee reaches a conclusion on whether Grover is guilty of misconduct and gross negligence,” said Salman Waris, partner at Delhi-based law firm TechLegis.

“Grover can now try to approach the HC to secure an interim injuction. But in the circumstances, I doubt the court will give him any immediate relief,” added Waris.

 The company and Grover are also reportedly in talks to settle the matter by buying out the latter’s stake in the unicorn. Grover’s stake of 9.5 per cent in the company was worth Rs 1,915 crore based on the last funding round in August, when BharatPe was valued at $2.8 billion.

Key investors at BharatPe have turned down an offer made by Grover to sell his stake for over Rs 4,000 crore if they want him to quit the firm, according to sources.

Grover seems to have valued the payments company at around $6 billion — far higher than its valuation in the last funding round. However, the fintech start-up was looking at a fresh raise in January this year at a valuation of around $4 billion, the sources said.

The battle between the investors and Grover came to a head on Wednesday, when the company announced that it had terminated the services of Grover’s wife, Madhuri Jain, who was head of controls, over alleged financial irregularities and cancelled her stock options.

The company’s key investors include Sequoia Capital, with a 19.6 per cent stake, Coatue (12.4 per cent), Ribbit Capital (11 per cent), Beenext (9.6 per cent), among others. The investors have cumulatively put in over $700 million in the company. In the subsequent rounds of capital raise, they have increased their collective stake in the company to over 66 per cent, even as the founders’ stake has been going down.