Eversource Capital has made a Rs 1,200 crore non-binding offer for troubled ride-hailing service BluSmart, said people aware of the matter. However, Eversource, a leading climate investor, may not pursue a deal due to ongoing regulatory probes at sister concern Gensol Engineering from whom BluSmart leases the bulk of its electric vehicle fleet, the people said.
Instead, Eversource may consider other options for acquiring BluSmart such as holding direct negotiations with Gensol’s lenders like Power Finance Corp (PFC) and Indian Renewable Energy Development Agency (IREDA) to whom a large number of BluSmart’s EV fleet is hypothecated, both having financed the car purchases, the people said. Gensol has leased around 5,000 cars to BluSmart.
A slump sale to Eversource was also one of the options being discussed by BluSmart's investors, the people said. This would ringfence the acquirer from any liabilities pertaining to BluSmart’s operations.
Eversource's current offer to BluSmart shareholders is subject to due diligence, the people said.
BluSmart cofounder Anmol Singh Jaggi had detailed Eversource's investment proposal in a letter to the ride-hailing firm's shareholders earlier this month. “BluSmart is at a critical juncture and must make informed and timely decisions to ensure business continuity, preserve stakeholder value, and chart a sustainable path forward,” he wrote.
News website Inc42 first reported about Eversource's interest in BluSmart on Saturday.
Meanwhile, BluSmart has started onboarding its cars on rival platform Uber.
Eversource has partnered with Lightsource BP’s founders to invest in climate-related ventures in India. Lightsource BP's founders recently sold their company to BP. Incidentally, BP Ventures is an investor in BluSmart.
BluSmart’s promoters Anmol Singh Jaggi and Puneet Singh Jaggi are facing a forensic probe by market regulator Sebi for alleged fund diversion and corporate governance lapses at sister concern Gensol Engineering. The Jaggi brothers are also promoters of Gensol.
Eversource Capital did not respond to queries. Anmol Jaggi termed ET’s queries as ‘wrong information’ in a text message.
Eversource recently exited a large investment in Ayaana Renewable Power, selling it to a consortium of NTPC and ONGC for an enterprise value of $2.2 billion. It owned a 17% stake in the company. Among its other investments in India are Green Cell Mobility, which runs electric buses, and Lithium Urban Technologies, which runs electric cars.
BluSmart was negotiating a sale that would result in a payout to existing investors of Gensol of about Rs 400 crore. Further, Eversource would top up this investment with a capital infusion of around Rs. 800 crore into the company. Earlier, the ride-hailing company had also been talking to existing investors including BP Plc’s corporate venture arm BP Ventures for additional capital but those plans failed as well, pushing BluSmart into the current cash crisis.
The company hasn't paid salaries to its employees in March. It is also staring at lenders potentially declaring its loans as default, ET reported on April 21.
Instead, Eversource may consider other options for acquiring BluSmart such as holding direct negotiations with Gensol’s lenders like Power Finance Corp (PFC) and Indian Renewable Energy Development Agency (IREDA) to whom a large number of BluSmart’s EV fleet is hypothecated, both having financed the car purchases, the people said. Gensol has leased around 5,000 cars to BluSmart.
A slump sale to Eversource was also one of the options being discussed by BluSmart's investors, the people said. This would ringfence the acquirer from any liabilities pertaining to BluSmart’s operations.
Eversource's current offer to BluSmart shareholders is subject to due diligence, the people said.
BluSmart cofounder Anmol Singh Jaggi had detailed Eversource's investment proposal in a letter to the ride-hailing firm's shareholders earlier this month. “BluSmart is at a critical juncture and must make informed and timely decisions to ensure business continuity, preserve stakeholder value, and chart a sustainable path forward,” he wrote.
News website Inc42 first reported about Eversource's interest in BluSmart on Saturday.
Meanwhile, BluSmart has started onboarding its cars on rival platform Uber.
Eversource has partnered with Lightsource BP’s founders to invest in climate-related ventures in India. Lightsource BP's founders recently sold their company to BP. Incidentally, BP Ventures is an investor in BluSmart.
BluSmart’s promoters Anmol Singh Jaggi and Puneet Singh Jaggi are facing a forensic probe by market regulator Sebi for alleged fund diversion and corporate governance lapses at sister concern Gensol Engineering. The Jaggi brothers are also promoters of Gensol.
Eversource Capital did not respond to queries. Anmol Jaggi termed ET’s queries as ‘wrong information’ in a text message.
Eversource recently exited a large investment in Ayaana Renewable Power, selling it to a consortium of NTPC and ONGC for an enterprise value of $2.2 billion. It owned a 17% stake in the company. Among its other investments in India are Green Cell Mobility, which runs electric buses, and Lithium Urban Technologies, which runs electric cars.
BluSmart was negotiating a sale that would result in a payout to existing investors of Gensol of about Rs 400 crore. Further, Eversource would top up this investment with a capital infusion of around Rs. 800 crore into the company. Earlier, the ride-hailing company had also been talking to existing investors including BP Plc’s corporate venture arm BP Ventures for additional capital but those plans failed as well, pushing BluSmart into the current cash crisis.
The company hasn't paid salaries to its employees in March. It is also staring at lenders potentially declaring its loans as default, ET reported on April 21.
