Allcheckdeals India Private Limited (a wholly owned subsidiary of Info Edge (the Company)) (“AIPL”) had made financial investment and provided funding from time to time to 4B Networks (which is engaged in the business of enabling real estate developers and brokers to communicate with each other and conduct their business through the ‘Broker Network’ platform and a platform for loan origination for end-consumers) – amounting to approx. INR 288.00 crores (i.e. investment of approx. INR 276.00 crores as investment into shares and INR 12.00 crores as debt financing).
The Company has earlier disclosed that the investments into the shares of 4B Networks and the loan have been fully impaired, in the backdrop of various factors including inter alia excessive cash burn, prevailing liquidity issues and significant uncertainty towards funding options.
In the backdrop of the various aforesaid issues, AIPL has been, at various instances, seeking information, including details and particulars of financial transactions, transactions with related parties and such other aspects from 4B Networks and its current management, all of which are required to be provided to AIPL contractually under the shareholders’ agreement and articles of association of 4B Networks. However, as per the Company, 4B Networks has repeatedly failed to provide AIPL with such information and has also not responded to the information requests by the Company on several occasions. As a consequence thereof, AIPL has exercised its contractual rights under the shareholders’ agreement and articles of association of 4B Networks and pursuant to the same, is initiating a forensic audit into the affairs of the investee company, i.e., 4B Networks and has appointed Deloitte Touche Tohmatsu India LLP as the forensic auditor in this regard, who will be supported and assisted by Saraf and Partners Law Offices, legal advisors to the Company.
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