ED Searches Se­quoia Of­fice on Vasan Link

VC firm says it quit Vasan board in Nov & had sought probe into charges against co

The Economic Times - - Front Page - Our Bureau 22.2 crore

New Delhi: Se­quoia In­dia, whose of­fice was searched by the En­force­ment Direc­torate on Mon­day, said its rep­re­sen­ta­tive re­signed from the board of Vasan Health­care in Novem­ber last, as it dis­tanced it­self from an in­ves­ti­ga­tion which in­volves the son of for­mer fi­nance min­is­ter P Chi­dambaram. VT Bharad­waj, a man­ag­ing di­rec­tor of Se­quoia Cap­i­tal In­dia, re­signed on Novem­ber 18, and two months be­fore that he had “de­manded that man­age­ment of Vasan Health­care con­duct a thor­ough in­ves­ti­ga­tion into the al­le­ga­tions”, the ven­ture cap­i­tal firm said in a state­ment on Tues­day.

The Ben­galuru of­fice of Se­quoia was searched by ED, which is in­ves­ti­gat­ing sus­pected money laun­der­ing and tax eva­sion in­volv­ing Vasan, which the au­thor­i­ties be­lieve has con­nec­tions to Karti Chi­dambaram, the son of the for­mer FM. Clear­ing Air Agency prob­ing al­leged FEMA vi­o­la­tions worth

by Ad­van­tage Strate­gic and Vasan Health­care VC firm says it is a mi­nor­ity in­vestor in Vasan

“Dur­ing the course of this in­ves­ti­ga­tion, the Se­quoia Cap­i­tal In­dia team has met the ED of­fi­cials mul­ti­ple times and has an­swered ev­ery query placed be­fore us. We adopted the same ap­proach yes­ter­day dur­ing the ED visit to our of­fices,” the Se­quoia state­ment said.

Se­quoia, whose in­vest­ments world­wide in­clude com­pa­nies such as Ap­ple, Google and What­sApp, clar­i­fied that it is “a mi­nor­ity in­vestor in Vasan, which is one out of the 100+ in­vest­ments made in In­dia over the last 10 years” and that it has no con­nec­tion to the in­ves­ti­ga­tion into the Air­cel-Maxis case, where too Karti Chi­dambaram is be­ing probed. On Tues­day evening, Bharad­waj was listed as a di­rec­tor on the web­site of Vasan Eye­care, along with KP Balaraj, co­founder of WestBridge Cap­i­tal, and Ar­jun Gupta, se­nior vice-pres­i­dent at GIC, the other in­vestors in the com­pany.

ED of­fi­cials, speak­ing on condi- tion of anonymity, said doc­u­ments re­lated to Se­quoia Cap­i­tal were found dur­ing raids in Chen­nai (late last year) at the of­fice of Karti Chi­dambaram. The agency is in­ves­ti­gat­ing al­leged vi­o­la­tions of the For­eign Ex­change Man­age­ment Act amount­ing to Rs 22.2 crore by an en­tity called Ad­van­tage Strate­gic Con­sul­tants Ltd and Vasan Health­care.

Af­ter a se­ries of trans­ac­tions be­gin­ning with founder AM Arun, Ad­van­tage came to own a stake in the com­pany in 2008. Ad­van­tage was mostly owned by Aus­bridge Hold­ings & In­vest­ments, which in turn was ma­jor­ity owned by Karti Chi­dambaram. ED of­fi­cials claim they have found ev­i­dence to link Se­quoia to the al­leged trans­ac­tion where the ven­ture firm’s ac­counts were “mis­used”. Se­quoia first in­vested in Vasan in 2009, and in Oc­to­ber 2010 it bought a stake from Ad­van­tage. Karti Chi­dambaram de­clined to com­ment. He sold his stake in Aus­bridge in 2012. Arun could not be im­me­di­ately con­tacted by phone.

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