In January, co-founder of GoMechanic Amit Bhasin admitted to financial misrepresentation by the company.
Indian automobile after-sales service startup GoMechanic has been acquired by a consortium led by Lifelong Group, a New Delhi-headquartered auto components maker. The sum and other financial details of the deal are not yet disclosed.
According to a Reuters report, citing a statement by Lifelong, the acquisition of GoMechanic is the result of a “widely publicised” sales process in which the consortium emerged as the winning bidder. The deal will help in preserving the ecosystem and provide a continued livelihood to the employees at GoMechanic, it added.
In January, co-founder of GoMechanic Amit Bhasin admitted financial misrepresentation by the company in a LinkedIn post and said that the founders of GoMechanic “got carried away” in the quest to explore growth opportunities. “Our passion to survive the intrinsic challenges of this sector, and manage capital, took the better of us and we made errors in judgment as we followed growth at all costs, including in regard to financial reporting, which we deeply regret,” Bhasin said at that time.
Venture capital firms Tiger Global, Sequoia Capital, and Chiratae Ventures, who were major investors in the beleaguered startup, ordered a probe into the company following Bhasin’s statement. Additionally, the Indian startup also announced let go of around 70% of its workforce, impacting around 700 employees, as a part of a restructuring process.
Meanwhile, the acquisition will help Lifelong Group in expanding its operations in the automotive service and repair industry, Reuters reported. Hero, General Motors, Exide, and Panasonic are some of the key names that form the clientele of Lifelong Group.