Blusmart Buyout Buzz Grows — But Gensol’s Troubles May Derail The Ride

Amid increasing controversy, murmurs of a imaginable buyout of Gensol’s EV ride-hailing subsidiary—BluSmart Mobility—are doing nan rounds. Reports propose that effect finance patient Eversource Capital has evaluated a imaginable acquisition pegged astatine astir Rs 1,000 crore. However, nan patient has declined to comment, stating that it regularly assesses business opportunities arsenic portion of modular operations.

The regulatory power connected Gensol Engineering Ltd is intensifying by nan day. After nan Securities and Exchange Board of India (SEBI) initiated action against nan Jaggi brothers (Puneet Singh Jaggi and Anmol Singh Jaggi, promoters of Gensol) complete alleged financial misconduct, PFC (Power Finance Corporation) has now revenge a general title pinch nan Economic Offences Wing (EoW), alleging archive falsification successful nan electrical conveyance (EV) leasing task involving Gensol.

In this climate, nan anticipation of a BluSmart buyout has raised eyebrows.

Legal experts be aware that immoderate woody for BluSmart will not beryllium a cleanable sweep. “A purchaser would inherit not conscionable nan business but besides nan baggage of a perchance tainted brand,” says Siddharth Chandrashekhar, Advocate & Counsel astatine Bombay High Court and elder sheet counsel for CBIC & DRI.

The building of nan business poses different hurdle. BluSmart’s EV fleet is leased from its genitor Gensol and not owned directly. That adds complexity to immoderate plus acquisition aliases business transfer, pinch imaginable ineligible and financial liabilities successful nan mix.

“SEBI is yet to initiate a forensic audit into Gensol and its related entities, including BluSmart,” says Vaibhav Kakkar, Senior Partner astatine Saraf and Partners. “Any adverse findings will further complicate a buyout. Until there’s clarity from SEBI’s side, superior buyers whitethorn stay cautious.”

From a ineligible standpoint, immoderate acquisition would require thorough owed diligence and contractual safeguards. “Representations, warranties, and indemnities would beryllium basal to shield nan acquirer from past liabilities tied to Gensol,” Chandrashekhar adds. He besides points to nan captious request for compliance pinch Section 188 of nan Companies Act, 2013 and SEBI’s LODR Regulation 23, some of which woody pinch related-party transactions and audit oversight.

While BluSmart has built a estimation arsenic a customer favourite successful India’s EV mobility space, nan worsening business astatine Gensol whitethorn derail immoderate easy takeover—at slightest for now.

Published on: Apr 23, 2025 6:35 PM IST