MCA looking at BharatPe Board’s conduct in Ashneer Grover controversy

Ashneer Grover last week resigned as company’s managing director and director, says he will cooperate with ministry.


bharatpe | Ministry of Corporate Affairs | Ashneer Grover

The Corporate Affairs Ministry is looking at how the board of fintech unicorn BharatPe acted in its fight with former senior executive Ashneer Grover, a source has told Business Standard.

Grover last week resigned as the managing director and director after getting to know from minutes of an agenda that a Board meeting would discuss alleged financial wrongdoings by his family at the company.

“I haven’t (made a representation to the ministry). But I’ll be pleased to cooperate with MCA as an Indian MD and shareholder who has been wronged,” said the embattled founder of the company in a text message on Wednesday, referring to the abbreviation for the ministry.

Business Standard has reached out to the company for its comment on the ministry checking the company’s board. This article will be updated when a response is received.

After Grover’s exit, there have been questions on whether his shareholding of around 9 per cent in the company is not entirely his. According to reports, Grover and co-founder Shashvat Nakrani held some of third co-founder Bhavik Koladiya’s stake. BharatPe’s board has taken a view that the co-founders have to sort out the issue amongst themselves.

Grover rubbished questions about his shareholding. “It’s hilarious. You should go and ask the company one simple question. Did the Board lie to the RBI (Reserve Bank of India) about shareholding?”

“I own all my shares. Who is Bhavik? I’ve got nothing to sort out with anyone. Maybe Sequoia is holding shares for someone – not me,” he said.

“Boss, Bhavik is no one. I have a written representation to me from the Board that Bhavik is no one and does not even hold any ESOP (employee stock option plans) – leave aside equity,” Grover added.

Meanwhile, purported copies of Grover and wife Madhuri Jain’s income tax payments have emerged. According to the bank receipts reviewed by Business Standard, the husband-wife duo have cumulatively made advance tax payments of Rs 8.2 crore for FY22.

Jain, who was earlier the head of controls at BharatPe, was fired last month by the company on the basis of alleged wrongdoings.

Grover refused to comment on whether the tax receipts were genuine.

Asked about whether he plans to sell his stake or stay put till an IPO, he told Business Standard: “It’s a function of how a company performs. It’s been two months of degrowth ever since I’ve been out of things.”

“I’ll have to see business performance and new product launches as per timelines to have faith in holding stake here as against deploying my money elsewhere,” he said.

On Tuesday, BharatPe co-founder Shashvat Nakrani accused Grover of lying about the company, and said the Board acted quickly and decisively in unseating him after receiving finds of a PwC report.

In a letter to employees, Nakrani said the Grover episode was an aberration and not the norm at BharatPe, and went on to defend the board who he said were celebrated names in the banking and financial services industry.

“Ashneer Grover, my co-founder, is no longer associated with BharatPe as an employee, a founder or a director of the company,” he wrote.

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