BharatPe’s Ashneer Grover and Madhuri Grover said Kotak backtracked on IPO promiseNew Delhi: The co-founder of payments firm BharatPe has sent a legal notice to Kotak Mahindra Bank in a dispute over shares of FSN E-Commerce Ventures Ltd, which owns the e-tailer Nykaa, whose blockbuster initial public offering last year valued the Indian company at nearly Rs 96,000 crore.BharatPe co-founder Ashneer Grover and his wife Madhuri Grover have alleged that Kotak Mahindra Bank went back on their deal to get them shares worth Rs 500 crore in FSN E-Commerce Ventures Ltd after Nykaa’s initial public offering, or IPO, was launched.The bank responded saying it is looking at legal options against Mr Grover for using “inappropriate language” in a call with a Kotak Mahindra Bank employee. Last week, an audio clip surfaced on social media where a couple is purportedly speaking to who appears to be a relationship manager from a bank. The man hurled abuses and the bank employee is heard pacifying him.Mr Grover has called the audio clip “fake”.”Our clients had proposed to apply for subscription to the shares of FSN in the name of both Ashneer Grover and Madhuri Grover, for shares worth Rs 250 crore each. Out of the total sum of Rs 500 crore which was proposed to be invested by our clients in the Nykaa IPO, our clients were required to pay a sum of approximately Rs 20 crore at the outset, and the balance amount was to be paid after the allotment of shares of FSN to our clients,” the Grovers’ lawyer said in the notice to Kotak Mahindra Bank.”However, to the shock and surprise of our clients, on 28 October 2021, after having repeatedly assured our clients that the shares of FSN would be allotted to them, Kotak informed our clients that it would not be able to provide IPO financing for the Nykaa IPO. Kotak’s refusal to comply with its assurances was on the pretext that it had decided not to finance the Nykaa IPO due to ‘erratic FII movements’ and ‘very high lending rates’,” the legal notice said. FII is short for foreign institutional investor.The Grovers alleged Kotak’s refusal to provide IPO financing at the eleventh hour completely crippled their ability to participate in the Nykaa IPO and deprived them of an investment opportunity about which they had informed Kotak Mahindra Bank more than a month before the IPO was launched.”Had Kotak informed our clients at the very beginning that it would be unable to provide IPO financing for the Nykaa IPO, our clients would have approached other financiers who were ready and willing to provide IPO financing to our clients for this IPO,” the legal notice said.Kotak Mahindra Bank in a statement denied any breach or violation in the deal with the Grovers.”This notice was received by us and was replied to appropriately at the time, including placing on record our objections to inappropriate language used by Mr Grover. Appropriate legal action is being pursued. We would like to confirm that there is no breach or violation by the Kotak Group in any manner whatsoever,” the bank said in the statement.