AskMe Group stops services temporarily on fund crunch
According to AskMe, Astro Entertainment Networks which owns 99% in AskMe, was in talks for a management buyout which has not happened till date
New Delhi: The AskMe Group, which runs ventures such as online search, listings and deals portal AskMe.com and e-commerce site AskMeBazaar, has temporarily suspended operations due to a shortage of funds, according to two company executives who spoke on condition of anonymity.
While AskMeBazaar’s website was found to be operating on Friday, it did not accept orders.
Medianama, a web-based portal for news and analysis of digital media in India, was the first to report this on Thursday.
Some media reports said the group had also laid off 4,000 employees.
The group did not comment on the suspension of services, but said that there had been no immediate layoffs.
“Normal churning happens every year which happened this year as well. Specifically, there have been no layoffs in the last month, given this uncertain environment created by Astro. People have been leaving for better prospects on their own will, which is natural as well,” it said in a statement.
According to AskMe, Astro Entertainment Networks Ltd (AENL) which owns 99% in AskMe through various shell companies, was in talks for a management buyout which has not happened till date. Besides, it has failed to clear its dues.
“We request Indian authorities to ask Astro to pay their dues as per written commitments and let the MBO (management buyout) happen for the future of the company,” the statement said without specifying the amount.
Getit Infoservices, AskMe’s parent, runs online search platform AskMe, online marketplace AskMeBazaar, grocery marketplace AskMeGrocery, furniture and home décor portal Mebelkart, and payments platform AskMePay among other ventures.
In 2015, Getit acquired online grocery start-up Bestatlowest to merge it with AskMeGrocery. Mebelkart’s inclusion was also through a majority stake purchase in the firm in 2015.
The top management within the group includes founder and managing director Sanjiv Gupta, AskMeGrocery head Ankit Jain, AskMeBazaar chief executive officer Kiran Murthy and AskMe Group chief marketing officer Manav Sethi.
According to a statement by Astro, it has invested nearly $300 million in Getit Infoservices since 2010.
“AENL has made sustained and long term investments in Getit totalling nearly $300 million to date to keep the business afloat during often volatile market conditions. Unfortunately, Getit has not been able to make its business profitable and sustainable despite these huge investments by AENL. An independent review by advisors has concluded that there is little prospect for turnaround and the business is insolvent,” it said.
Astro also intends to appoint a forensic auditor to review Getit’s books and will take steps based on the results of that audit, it added.