Beauty e-commerce firm Nykaa had made a strong debut in the public markets last year, listing at a premium of 79% over its issue price on the National Stock Exchange. However, Nykaa’s IPO seems to have served as the base for a tussle between fintech unicorn BharatPe’s co-founder and MD Ashneer Grover and Uday Kotak, Kotak Mahindra Bank’s managing director and CEO.
The two have locked horns ever since Grover and his wife sent a legal notice to Kotak (and addressing several others) for failing to provide IPO financing and allocation of shares.
Let us provide some background on the issue first. Nykaa’s IPO lasted from October 28 to November 1. In September, Grover had told Grover told an executive of Kotak Wealth Management that he wished to apply for Rs 500 crore worth of shares in Nykaa, and asked for IPO financing for the same.
In October, the same executive obtained Grover’s signatures on certain documents for subscribing to Nykaa’s IPO. In the same month, Kotak said that it could not provide IPO financing and cited reasons such as erratic FII movements and very high lending rates.
A few days later, Grover sent the notice, addressing not only Kotak but also Oisharya Das, CEO, Kotak Wealth Management, Shanti Ekambaram, group president- consumer banking and KVS Manian, director and president-corporate, institutional and investment banking at the bank. He alleged that failure to provide IPO financing led to losses and “completely crippled” the ability of its clients to participate in the Nykaa IPO.
Grover alleged that it also deprived their clients of “a business/investment opportunity about which they had informed Kotak more than a month in advance of the launch of the IPO. Had Kotak informed our clients at the very beginning that it would be unable to provide IPO financing for the Nykaa IPO, our clients would have approached other financiers who were ready and willing to provide IPO financing to our clients for this IPO.”
So why does this notice assume importance today, months after Grover had sent it? This is where the audio clip comes into play. Last week, Grover had found himself in the middle of a controversy for allegedly threatening to kill a Kotak Mahindra Bank employee. An audio clip of the same went viral of social media, in which Grover launched death threats and curses to the employee.
In return, Kotak Mahindra Bank said on Sunday that it will be pursuing legal action against Grover for the use of inappropriate language against the employee. The bank also placed on record its objections against Grover for the use of such language.
Grover later took to social media to say that the audio clip was fake, but curiously, later deleted the posts that claimed the clip to be fake.