Global creditors of Udaan have initiated insolvency proceedings against Trustroot Internet Pvt. Ltd., the company's Singapore-based holding entity, after it defaulted on $170 million of compulsorily convertible notes that matured on June 30. According to multiple reports, creditors have appointed Alvarez & Marsal as liquidator in insolvency proceedings before the Singapore High Court after failing to reach an agreement with the company on a debt restructuring package. They filed a winding-up petition on Tuesday, marking the unravelling of another homegrown unicorn in the process of an India listing.
Udaan has clarified that the legal proceedings are limited to its offshore holding company and have no impact on its operations in India. As reported by Economic Times, the company stated that "the matters referenced relate to ongoing restructuring negotiations and offshore proceedings among offshore stakeholders at the offshore holding company level. These discussions have no bearing on our operating entities in India, where our teams employ our people and run the day-to-day business." The company confirmed that Udaan and UdaanCapital continue to operate as usual, serving customers across trade commerce and supply chain financing.
The insolvency proceedings come amid a deepening liquidity crisis for Udaan. According to Economic Times, lenders including JP Morgan, HSBC, DBS and Axis Bank have withdrawn working capital facilities in recent weeks. Bondholders had offered to extend the debt's maturity if the company secured fresh equity, but the talks reportedly failed. The holdco issuer needed to pay $170-200 million to bondholders by June end to settle the maturing notes, including the redemption premium. With mounting losses and a near 70% drop in the company's equity valuation, creditors in recent weeks refused to accept terms for a debt-restructuring plan that the firm and its advisors were negotiating.
Backed by Lightspeed Venture Partners, DST Global and Tencent, Udaan has accumulated about ₹13,000 crore in losses since its inception. As reported by Economic Times, the company's FY25 revenue declined 20 per cent to ₹4,561 crore, while net loss narrowed 37 per cent to ₹1,055 crore. The company recently raised ₹50 million-$60 million from existing investors, including M&G Prudential and Lightspeed Venture Partners. According to Tracxn, the company has raised nearly $2 billion across multiple debt and equity rounds, with its peak valuation of $3.2 billion in 2021.
In 2025, Udaan secured the National Company Law Tribunal (NCLT) approval to consolidate its technology, logistics and wholesale trading units under a single entity, Hiveloop Ecommerce. Singapore-registered Trustroot was to be reverse merged into the India-domiciled entity as part of this exercise ahead of the IPO. CEO Vaibhav Gupta told Economic Times in March that the IPO timeline was 9-18 months away, with the company working on getting the business to break even by mid-next year. The company is exploring a separate $40 million financing facility backed by pledged shares, with BlackRock among potential investors, while Lightspeed remains the single-largest shareholder at about 33% with $917 million deployed so far.
