The Hindu Business Line
German payments firm Wirecard faces questions in Chennai court over unit buy
Wirecard AG, the German online payments company dogged by an accounting scandal, faces new questions in a lawsuit about how much it paid for an Indian subsidiary.
The former owners of Hermes I-Tickets, a company Wirecard bought in 2015, are suing the German company over allegations it made false claims about how much it paid to them at the time, according to a lawsuit filed in Chennai. GI Retail Pvt Ltd is asking Wirecard to clarify details of the transaction. The lawsuit is the latest headache for Wirecard about alleged accounting issues at its Singapore operations. Hermes is also being investigated by the Singapore police as part of the wider probe into potential wrongdoing at the German company’s Asian division.
A Wirecard investigation found some of its Singapore employees may be criminally liable.
In the transaction at the centre of the lawsuit, Wirecard announced in October 2015 it agreed to pay up to $382 million to GI Retail to acquire its payment businesses. Wirecard bought Hermes, which specialised in selling travel tickets, for €216 million up front with an option to pay a further €110 million.
GI Retail claims in the lawsuit, however, that it was paid a fraction of that in a deal with a Mauritius-based fund called Emerging Markets Investment Fund 1A.