BharatPe investors turn down Grover offer to sell stake for Rs 4k crore

A final decision on Ashneer Grover's fate at BharatPe may be taken by the investors and the board after the audit report is presented

Key investors at BharatPe have turned down an offer made by co-founder Ashneer Grover to sell his 9.5 per cent stake in the fintech start-up for over Rs 4,000 crore if they want him to quit the company, say sources in the know.

Grover seems to have valued the payments company at around $6 billion — far higher than its valuation of $2.8 billion after a fundraise last August. However, the company was looking at a fresh raise in January this year at a valuation of around $4 billion.

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), amongst others. The investors have 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.     

Says a source involved in the discussions, “Why should investors pay to buy Grover’s shares? He has a minority stake and can continue to keep it and exit when there is an IPO or something. The return he gets on his shareholding will depend on the performance of the company. And the basis of his valuation has no meaning.”

A BharatPe spokesperson declined to comment on the issue.  

The company has already appointed auditors PwC, and the audit report is expected to be ready next week. The company’s board had asked for a “governance review”. A final decision on Ashneer Grover’s fate at BharatPe will be taken by the investors and the board only after the audit report is presented, say sources.

Grover has gone on voluntary leave for three months.

According to its website, BharatPe has been processing over 50 million Unified Payments Interface (UPI) transactions a month, with annual third-party verifications (TPV) of over $7 billion. It has an extensive network of 5 million merchants across the country.