Car servicing startup GoMechanic, which admitted financial irregularities and received a notice to initiate insolvency proceedings, has finally found the buyer. Delhi-based auto parts maker Lifelong Group said it is acquiring the majority stakes in the startup through its subsidiary Servizzy.
Earlier, it was reported that auto tech firm CarTrade was in talks with GoMechanic to acquire stakes in the company. Although the current buyer didn't disclose the financial terms of the deal, reports suggest that Lifelong India will take over GoMechanic's spare parts division to complement its own core area of business.
“Due to the recent financial difficulties at GoMechanic, the board, and shareholders with support from Stride Ventures initiated a speedy and widely publicized sale process to ensure the continuity of business,” LifeLong said in a release.
Incepted in 1985 by Atul Raheja, Lifelong India is a supplier of automotive components, plastics, and casting components.
In January of this year, vendors of the Gurugram-based startup GoMechanic reported non-payment of dues, which exposed the fraudulent activities within the company. During its due diligence process, SoftBank’s Vision Fund, which was considering investing in GoMechanic, discovered irregularities in the startup’s reported numbers. As a result, SoftBank alerted GoMechanic’s current investors about the inconsistencies.
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