Ola to purchase agency promoted by CEO’s brother

Ola has entered into an settlement to amass Avail Finance, a fintech firm based by the brother of the experience hailing platform’s CEO Bhavish Aggarwal. The acquisition can be price $50 million, it’s learnt, and is awaiting shareholders’ approval.

Ola already owns 9 per cent stake in Avail Finance and Bhavish Aggarwal serves on the corporate’s board as a director, whereas his brother Ankush Aggarwal owns over a 25 per cent stake within the firm.

“The acquisition is a key step in Ola’s broader push into the fintech space as it looks to build a mobility focused financial services business under Ola Financial. With this acquisition Ola Financial Services will further strengthen its play in the credit underserved segments that comprises blue collar workers such as Ola’s driver partner ecosystem,” Ola stated in an announcement.

As a part of the deal, Avail Finance’s management staff will be a part of Ola Financial Services, a 100 per cent subsidiary of ANI Technologies, Ola’s guardian firm.

Sources conscious of the small print of the transaction stated that the deal got here via as Avail Finance was going through monetary difficulties and was struggling to lift funds. “The company was valued at around $70 million after its Series B round of $11.5 million in August 2020. So the acquisition at $50 million is a step down from its earlier valuation,” stated an individual conscious of the event, requesting anonymity.

According to Avail Finance’s regulatory filings, its income from operations at Rs 4.5 crore decreased 20 per cent in FY21 in comparison with Rs 5.6 crore in FY20. It additionally registered losses price over Rs 37 crore in FY21.