You see, in 2019, when Ola Electric had been hived out of Ola Cabs, the new entity had signed a deal with Ola Cabs parent (ANI Technologies).
- Under that deal, ANI allowed Ola Electric to use OLA brand and logo against a royalty fee
- And similar deals also exist with other group companies, like Krutrim AI, and Ola Maps etc
All of these yield good money to ANI, whose primary ride-hailing business is publicly known to be on a consistent decline.
..
But if Bhavish, the founder, moves the ownership of the brand IP to his personal family office, this will lead to two things.
1 - Instead of the ride-hailing unit which today gets all that royalty income, the money will flow to Bhavish’ personal pockets
2 - Bhavish will also be able to demand that ANI Technologies (the original owner of the brand OLA) be liable to pay the founder royalty for using the brand name OLA
Thus, in effect, what Bhavish will achieve in the name of group-wide restructuring is that the new structure makes him richer AT THE LOSS OF those who have invested in his group companies.
..
And it gets worse.
You see, the ride-hailing unit (ANI Tech) has been aiming for an IPO for 5+ years now.
Now, it’s at a stage where its market share is declining across cabs, bikes, and auto-hailing services.
Plus, the sentiment around the group companies is, anyway, not as bullish, thanks to the founder’s repeated controversies, multiple investigations on EV manufacturing sister company, and major governance lapses.
Amidst these, if ANI Tech is to lose one of its earning streams, and also add a new expense for using the brand it owned till today, it will bring down the allure of its IPO, if any exists anymore.
Anything illegal here? No. Anything sinister and full of greed? 100%.
..
Check out my WhatsApp communities with:
- 30k+ members - Biz News+ : https://lnkd.in/gjGV9raN
- 6k+ members - PrimeStuff : https://lnkd.in/gZ-qEdzA
Also check out my newsletters with ~9k others here: https://linktr.ee/jmundhra
Best,
Jayant
This post was originally shared by on Linkedin.