Udaan, the B2B ecommerce unicorn, is facing insolvency proceedings initiated by overseas creditors over a $170 million bond default, according to inc42.com. The crisis emerged after Udaan’s offshore holding company, Trustroot Internet, missed repayment on convertible notes due on June 30. This legal move follows weeks of unsuccessful debt restructuring talks and has led to major domestic banks withdrawing working capital lines from Udaan.
The financial troubles began last month when lenders took the matter to the Singapore High Court after Udaan failed to provide a clear upfront payout during restructuring negotiations. The company’s valuation has plummeted by 69% from its $3.2 billion peak in 2021 to below $1 billion, reflecting a 20% year-on-year revenue decline to ₹4,561 crore and operational losses of ₹1,055 crore. Udaan is now seeking a financial lifeline, working with Goldman Sachs to raise up to $200 million in equity funding and negotiating a $40 million credit facility from BlackRock by pledging shares.
The crisis highlights the challenges facing B2B ecommerce firms amid sector slowdowns and investor caution. Udaan’s valuation collapse and revenue drop underscore the difficulties in maintaining growth and profitability in a competitive market. The company’s struggles to attract investor interest despite ongoing talks with major financial institutions reflect broader market hesitancy toward downrounds and distressed assets in the startup ecosystem.
Udaan’s next critical milestone is securing the $200 million equity funding and the $40 million credit facility, which will determine its ability to stabilize operations. The Singapore High Court proceedings mark a significant step in the company’s financial restructuring efforts, with outcomes expected to influence its listing prospects and future capital-raising activities.