Ola Hits Back At Rosmerta Over Insolvency Petitions

Bengaluru-based Ola Electric has encountered significant challenges at the start of the year. The company is already struggling with sales, due to which it has dropped down to fourth position in the Indian EV race, according to data from Vahan portal. Earlier, the company had cited that this drop in sales was due to changes being made in its vehicle registration process. But now, two bankruptcy petitions have been filed against Ola by Rosmerta Digital Services, a vendor that handles its vehicle registration services. 

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The petitions were submitted to the National Company Law Tribunal (NCLT) in Bengaluru. Reports state that Rosmerta is seeking payment of approximately ₹22-25 crore in unpaid dues. As a result, news of these legal actions caused Ola's stock price to fall to a 52-week low, dropping below ₹50 per share (7 per cent drop). The dispute stems from Rosmerta's handling of registration and related functions for Ola. Sources indicate that while the volume of vehicles handled by Rosmerta increased substantially over recent years, their service fees remained unchanged. When Rosmerta requested renegotiation of terms, Ola reportedly stopped making payments, with dues now outstanding for about six months.

In response, Ola acknowledged in a filing that Rosmerta Digital Services Limited filed a petition under Section 9 of the Insolvency and Bankruptcy Code against Ola Electric Technologies Private Limited, a wholly owned subsidiary. The petition alleged default in payment for services and seeks to initiate a Corporate Insolvency Resolution Process.

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However, Ola did not mention the existence of a second petition. The company stated in reports that it strongly disputes the claims and will take all necessary steps to protect its interests and object to the allegations.

(Source: ETAuto)