Rentomojo Co-founder Sues Company, Seeks to Halt IPO Over Share Sale Dispute

• Rentomojo co-founder Ajay Nain has filed a petition with the NCLT, Bengaluru, alleging incomplete information during the sale of his stake in 2023.
• Nain seeks to void the transaction, restore his 9.41% shareholding, remove the promoter from the board, and restrict current management's business conduct.
• The petition specifically requests to restrain Rentomojo from filing its DRHP or proceeding with its proposed IPO.
• Rentomojo has filed caveats to prevent interim orders without a hearing; the matter is not yet listed, and no interim relief has been granted.
• The company plans a public issue including a fresh issue of up to ₹1,500 million and an offer for sale of up to 28.4 million shares, despite the ongoing legal dispute.

Key Questions Answered

How might the NCLT's decision on Ajay Nain's petition impact Rentomojo's IPO timeline and valuation?

Ajay Nain's NCLT petition could potentially halt Rentomojo's IPO timeline and impact its valuation.

What are the broader implications for startups and investors when co-founder disputes emerge during an IPO process?

Co-founder disputes during an IPO can stall the process and create uncertainty for investors.

Could Rentomojo's improving financial performance mitigate the risks posed by this legal challenge to its public offering?

Rentomojo's improving financial performance may partially mitigate risks from the legal challenge.