BluSmart’s Woes Mount as Uber Ends Fleet Partnership Talks

EV start-up BluSmart has come under another trouble after cab-hailing giant Uber called off discussions to integrate Gensol Engineering-owned company’s 5,000 electric cars into its platform, according to a report published by Mint. The company attributed the decision to high valuation and regulatory concerns. This deal was a part of BluSmart’s revival plan under which it was supported to become Uber’s fleet partner.

Uber decided to step back from the proposed deal after finding a mismatch between BluSmart’s asking price and its own valuation assessment, the report said, adding that the EV start-up didn’t adequately factor in the steep depreciation typically associated with electric vehicles, which became a sticking point.

This marks the second major blow for the Anmol Jaggi-EV ride-hailing start-up in recent weeks, following the collapse of Rs 315 crore agreement with Chennai-based Refex Group involving 2,997 cars, the report added.

Gensol Engineering had taken a loan of Rs 663 crore from Power Finance Corporation and Indian Renewable Energy Development Agency to acquire the cars leased to BluSmart.

BluSmart-Gensol Crisis

On April 15, India’s stock market regulator, SEBI, highlighted a significant decline in the promoters’ stake in Gensol Engineering. This was allegedly orchestrated through a network of false disclosures, sham transactions, and diverted funds, effectively resulting in a near-total promoter exit and leaving unsuspecting investors bearing the consequences.

Anmol Singh Jaggi and Puneet Singh Jaggi have been barred by SEBI from trading securities or holding positions as directors or senior management personnel in Gensol Engineering.

A few days ago, BluSmart has even appointed Grant Thornton to conduct a forensic audit after a regulatory investigation revealed that its cofounder allegedly diverted and misappropriated funds intended for vehicle purchases.

Grant Thornton has been tasked with examining BluSmart’s cash balance and fund transfers, a source said. The insider also expressed concerns about the company’s liquidity situation.