Ola said on Thursday evening it has reached an agreement to acquire Avail Finance, a financial services startup that serves the blue-collar workforce, as the ride-hailing giant looks to expand its financial services offerings.
The two startups did not disclose the terms of the deal. Avail Finance had raised about $38.5 million (including about $4.5 million in venture debt) across multiple rounds and was valued at $86.6 million, according to insight platform Tracxn (paywalled).
It’s worth noting that Ola co-founder and chief executive Bhavish Aggarwal and Avail Finance founder and chief executive Ankush Aggarwal are brothers. The two companies share Alpha Wave Global and Matrix Partners as major common investors. The deal is seeking approval from shareholders.
Ola said the acquisition will help the startup “strengthen its play in the credit underserved segments that comprise blue-collar workers such as Ola’s driver-partner ecosystem.” That play includes cross-selling “multiple lending products” to its driver partners, it added.
The bigger startup said it has invested nearly $104 million into its financial services business, which it said is already “showing strong growth across both its lending and insurance verticals.”
“Ola Postpaid, its BNPL offering, is available to 40 million customers, its vehicle financing business is growing rapidly in conjunction with Ola Electric as well as Ola Cars, its used cars business. With Insurance, Ola has built a first-of-its-kind embedded motor insurance journey for Ola Electric and Ola Cars, where customers can seamlessly select Insurance; and add ons like roadside assistance or zero depreciation within the buying journey,” it added.
More to follow…