Ola’s founders Bhavish Aggarwal and Ankit Bhati, along with Singapore-based Temasek Holdings are set to purchase around 10% stake in ANI Technologies, the parent company of the cab aggregator, through a secondary sale transaction, according to a filing made with the Competition Commission of India.
“The proposed combination pertains to the indirect acquisition of less than 10% of the share capital of ANI by Mr Ankit Bhati, Mr Bhavish Aggarwal and MacRitchie through Lazarus from certain existing shareholders of ANI,” the filing said. While Lazarus Holdings is a special purpose vehicle (SPV) which will be used as an investment holding company, MacRitchie Investments is an indirectly wholly-owned subsidiary of Singapore based group. The deal, which reportedly values Ola at $3.5 billion, is subject to the approval of country’s competition watchdog.
Many details about the deal, including the sellers of stake, the value and proportions of the purchase remain unclear. According to a report by the Economic Times, the deal could see – employees of Ola, angel investor Rehan Yar Khan, Accel India, Bessemer Venture Partners, Helion Venture Partners – sell their stakes. Citing sources aware of the development, ET said that Temasek will account for about 5% of the said purchase for around $150-200 million. The report goes on to say that the company will make further investments in the company via primary and secondary rounds in the future.
MediaNama reached out to Ola and Temasek for a comment, however, we did not receive a reply at the time of publishing.
Deal to strengthen Ola’s founders
The deal is likely to strengthen Aggarwal and Bhati’s stance of having control over the firm’s future and veto any future stake purchases in the firm. In May last year, Ola rewrote its articles of association to strengthen the founders’ rights by ramping up their holding in the total share capital of the company. The move was seen as an attempt by Ola’s founders to protect themselves against a hostile takeover, or even a potential merger or sale that SoftBank may engineer with its arch rival, Uber. Apart from holding a significant stake in Uber, SoftBank also backed companies which bought off Uber’s operations in other Southeast Asian markets.
This comes days after IndiaTech.org, a non-profit organisation which lobbies for domestic e-commerce and internet firms, said that it will push for Indian company founders getting Differential Voting Rights.
In July, Aggarwal and Bhati owned 7.15% and 3.64% of the company, respectively, while Japan’s SoftBank held 26.1%, Tiger Global had a stake of 15.9%. The Chinese firm Tencent had a shareholding of 10.3%, the Financial Express claims, citing Paper.vc.
— In October last year, the company raised $1.1 billion led by Tencent Holdings Limited. Ola’s existing investor SoftBank, in addition to other new US-based financial investors also participated in this round.
— Ola raised $36 million (Rs 231 crore) from New York’s Tekne Capital Management in August 2017. Two months before that, It had raised $50 million from Tekne in June.
— In May 2017, Ola raised Rs 670 crore from Ratan Tata’s venture fund RNT Capital Advisers LLP and US hedge fund Falcon Edge Capital LP. And, $250 million from Japan’s SoftBank Group Corp, in April.
— In November 2015, Ola Cabs raised Series F funding worth $500 million from Baillie Gifford, Falcon Edge Capital, Tiger Global, SoftBank Group, DST Global and China’s Didi Kuaidi.
Ola’s recent moves
Two senior Ola executives — Saikiran Krishnamurthy, senior vice-president, growth and Joy Bandekar corporate president of new initiatives — have quit the company this week. Last week, Ola launched Ola Mobility Institute to research on policy and mobility. In August, Ola’s parent company ANI Technologies, along with and Hero MotoCorp Chairman, Pawan Munjal, Stellaris Venture Partners and Matrix Partners India have invested an undisclosed amount of funding in Bangalore based scooter rental platform Vogo.
MediaNama reported last month that Ola will begin its operations in the UK next month, after having obtained licenses for South Wales and Greater Manchester. Earlier this year, Ola commenced its services in Australia, where it now operates in seven major cities. Besides that Ola has been looking at expansion in other countries such as New Zealand, Sri Lanka and Bangladesh and has teams in Dhaka and Colombo. However, its teams in Sri Lanka attracted trouble, as the company has already been accused of “commercial espionage” by local competitor PickMe. In July, the company announced that it has re-branded its credit/postpaid payment service called Ola Credit and will now be called as Ola Money Postpaid. In April, Ola acquired the Mumbai-based public transport ticketing and commuting service Ridlr in an all-stock deal.