Milkbasket faces a legal battle with Mahendra Nahata-led MN Televentures that had invested in the grocery delivery startup last year through a buyout of venture firm Kalaari Capital.
Last month, MN Televentures had filed an appeal against Milkbasket in the National Company Law Tribunal, according to an NCLT document, for refusing to acknowledge the transaction.
In the same month, the bankruptcy court then asked the startup to submit its response within three weeks. The next date for hearing is February 28.
The development was first reported by The Economic Times. Sunil Batra, director at MN Televentures, told the business daily that Milkbasket had violated the law by refusing to register the transfer of shares in the name of the acquirer.
The daily also said that Milkbasket's board had opposed the stake sale by Kalaari to MN Televentures. The deal apparently threw a spanner into Milkbasket's plans of getting acquired with investors reportedly backing out as MN Televentures’ Nahata is a director on the board of Reliance Jio Infocomm, a potential conflict for them.
To be sure, Reliance and Bigbasket were reportedly in separate talks to buy Milkbasket but nothing worked out due to valuation issues.
An email sent to Milkbasket, MN Televentures and Kalaari did not elicit a response till the time of filing this story.
Milkbasket, which is operated by Aaidea Solutions Pvt. Ltd, was founded in 2015 by Anant Goel, Ashish Goel, Anurag Jain and Yatish Talvadia. With a full-stack supply chain from sourcing to last-mile delivery, the company says it aims to service over a million households by next year.
Kalaari had first joined as an investor in Milkbasket in 2018. The startup had already raised funding from EVC Ventures, Blume Ventures, Unilever Ventures and the private investment firm of Lenovo group.
It had also raised $5.5 million in a fresh funding round led by angel network Inflection Point (IP) Ventures in June last year. Existing investors including Kalaari had also participated in the funding round then.
Interestingly, in June 2019, Flipkart co-founder Sachin Bansal’s investment vehicle had scrapped a proposal to invest Rs 20 crore ($2.86 million then) in Milkbasket. Weeks later, Milkbasket raised Rs 15 crore ($2.15 million then) in venture debt from InnoVen Capital.
Unlike bigger players in the online grocery delivery market such as Bigbasket, Grofers, Amazon and Flipkart, Milkbasket positions itself as the online version of local mom-and-pop grocery stores but with more stock keeping units. It generally supplies perishable and non-perishable products that are bought in smaller quantities but more frequently.