Online taxi aggregator TaxiForSure may see exits from its 1,500-strong workforce in the wake of its imminent acquisition by cross-town rival Ola. According to sources in the know, the company is working towards keeping the downsizing to the minimum.
Founded by IIM-Ahmedabad graduates Aprameya Radhakrishna and Raghunandan G in June 2011, TaxiForSure is likely to lay off some employees after the acquisition is formalised in the next two weeks, two people aware of the development told FE. Ola, backed by Japan’s SoftBank, is looking to to shell out $200-225 million in cash and stocks to close out the deal.
“TaxiForSure operates in 45 cities while Ola operates in about 65 cities with a marginally leaner team. In that case, it does not make sense for Ola to absorb the entire TaxiForSure team,” said a person aware of the development. “TaxiForSure is a top-heavy organisation and a few senior executives may also exit,” the person added.
According to the sources, TaxiForSure also held talks with US-headquartered Uber, which proposed to retrench about three-fourths of TaxiForSure’s staff, something neither Radhakrishna nor Raghunandan agreed with. Besides, TaxiForSure investors saw better value in joining forces with Ola, given its valuation of $660 million and headroom for growth.
TaxiForSure declined to comment. “This news is speculative and as a company policy TaxiForSure does not comment on any market speculation,” a spokesperson said in an email response.
Meanwhile, Ola, which was aggressively trying to poach employees from TaxiForSure until recently, has halted the hiring spree. According to a source, Ola is no longer hiring candidates from TaxiForSure.