Info Edge has initiated a forensic audit into 4B Networks. The consumer internet company, which wrote off its investment in the Rahul Yadav-founded company this year, cited that the proptech startup did not share financial information despite repeated requests.
In a notice to the stock exchanges, Info Edge said it has been seeking information including details of financial transactions and related party transactions—which were mandatory disclosures under the agreement—but there has been no response from 4B Networks.
Now, Info Edge has appointed Deloitte Touche Tohmatsu India as the forensic auditor. He will be supported and assisted by Saraf and Partners Law Offices, legal advisors to the Company.
“4B Networks has repeatedly failed to provide AIPL with such information and has also not responded to the information requests by the Company on several occasions,” the exchange filing noted.
Info Edge had invested Rs 288 crore into 4B Networks, including Rs 276 crore as equity and Rs 12 crore in debt. The company announced in the Q3 FY23 financial results that it wrote off its investments in 4B Networks.
The proptech startup, 4B Networks, was founded by controversial entrepreneur Rahul Yadav in 2020 and Info Edge had a 57% stake in the company. The startup’s platform enabled real estate developers and brokers to communicate with each other and conduct their business through the broker network platform.
Rahul Yadav has been working in the real estate space for some time. His earlier venture was merged with PropTiger and later left Housing.com in 2015 with a very public spat with the investors including SoftBank.