ankiti bose: Ahead of board meeting, ex-Zilingo CEO Ankiti Bose endorses cofounder’s proposal to buy company

Bengaluru: Ahead of a pivotal board meeting on Monday that will decide the fate of troubled business-to-business (B2B) fashion startup Zilingo, Ankiti Bose, the company’s ousted CEO, has endorsed a proposal from her estranged co-founder Dhurv Kapoor. to avoid liquidation of the firm.

In an email sent by Kapoor and approved by Bose, Kapoor proposed paying $48 million in outstanding debt and pumping an additional $8 million in fresh equity into the company.

ET viewed a copy of the email.

“I have worked to maintain value and move the company forward. I am pleased to now present a specific proposal for an MBO (management buyout which I have attached to this email,” Kapoor said in the email. e-mail of June 19.

Bose responded to Kapoor’s email saying she approved the management buyout proposal and urged the board to “look beyond the personal differences here and do the right thing”.

“As founders, our ultimate responsibility is to make sure we do everything we can to make sure the lights stay on

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at Zilingo and in the homes of the hundreds of people who make up it. Whatever our differences, in the end we started this company with the same goal. Today we have come together to fight for the same cause,” Bose said in a statement shared with ET.

“I strongly believe in the company’s core proposition and believe that, with time and the right team, the company’s operations can be revived in due course. This will restore value to the company’s lenders and shareholders. The attached MBO proposal reflects this belief and commitment,” Kapoor said in his June 19 note. “Investor group”). To reassure the board of directors, shareholders and lenders, the investor group is pleased to meet with all stakeholders regarding their credentials and their ability to complete the MBO,” he said.

Strand Hanson is the investment banker responsible for closing a deal to potentially buy out other investors in the company. It is not yet clear what valuation the buyback will take and whether it will go ahead at all.

Zilingo last raised $226 million in a 2019 funding round led by existing investors Sequoia Capital, Singapore’s sovereign wealth fund, Temasek and others, after which it was valued at $970 million. It also raised a $35 million bridging round from existing shareholders in 2021. Valuation is likely to have eroded significantly as a result of the ongoing crisis at the company.

An email sent to Zilingo yielded no response.

This offer is a preliminary non-binding offer, and the exact structure will be finalized by the investor group based on discussions with the directors, shareholders and lenders. However, the investor group and I believe that the best outcome for all parties would be a swift agreement that would allow the preservation of Zilingo’s business as it stands.”

Kapoor’s note to the company’s board said. “Given the potential of the business and the value you know this business can achieve, I urge you to consider the MBO as a preferred alternative to voluntary liquidation.”

The proposal does not say whether Bose will be back with the company if an agreement is reached. Bose, who was ousted on May 20, along with Kapoor and Zilingo’s management, own about 25% of the company.

In May, Kapoor, who was arguing with Bose, had written to the company’s employees about allegations of sexual harassment and a toxic work culture surrounding the startup. In an internal memo to employees on Wednesday, Kapoor wrote: “You may have heard an allegation that certain individuals at Zilingo ‘suppressed’ complaints of harassment. We’ve always had a culture that doesn’t tolerate sexual harassment, workplace harassment, bullying, or intimidation…In rare instances where workplace issues were reported, we’ve always followed a fair process and taken strict action.”

In an interview with ET after she was officially fired, Bose had said that this was not the end of the Zilingo saga.

“Following an investigation led by an independent forensics firm commissioned to investigate complaints of serious financial irregularities, the company has decided to terminate Ankiti Bose’s employment for cause and reserves the right to take appropriate legal action. said a company statement. when he fired his CEO last month.

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