BYJU’S Founder Addresses USD 1.5 Billion Claims Amid Insolvency Proceedings

New Delhi, Oct 17 (PTI) – Byju Raveendran, the founder of the beleaguered edtech company BYJU'S, recently expressed his willingness to reimburse lenders completely, contingent on their cooperation with him. His statement comes amidst the company’s ongoing insolvency proceedings, which involve claims amounting to USD 1.5 billion filed by US lenders.

During an extensive two-and-a-half-hour media call, Raveendran stated, “If they are willing to work with me, I am willing to give them money back before I take a single rupee out. We paid USD 140 million but they wanted the entire USD 1.2 billion which we have already committed or invested by then. There is no way we could have given them back for a long time. Most lenders wanted to settle but one or two wanted to make a killing out of it.”

The company’s financial predicament worsened after the Board of Control for Cricket in India (BCCI) approached the National Company Law Appellate Tribunal (NCLAT) for the recovery of dues amounting to INR 158.9 crore, leading to the initiation of insolvency proceedings. Although the company settled these dues, the NCLAT’s decision to revoke the insolvency proceedings was challenged by US lenders through their agent GLAS Trust, resulting in a Supreme Court ruling that reinstated the insolvency process.

BYJU’S had secured a USD 1.2 billion Term Loan B (TLB) from institutional investors via its holding company Byju's Alpha, involving lenders based in the United States. Issues began to escalate when allegations of defaults under the loan agreement emerged, leading these lenders to seek early repayment of the TLB.

The lenders, represented by GLAS Trust, have increased their claim to USD 1.5 billion, according to recent filings in Indian courts. Raveendran clarified, “No money raised from US lenders has come to India as it also needs permission from the Reserve Bank of India.” He highlighted the aggressive stance of certain lenders, describing them as focusing primarily on “making money out of distress.”

Raveendran also mentioned that the company’s expansion acquisitions were driven by investor enthusiasm, further exacerbating the financial strain. “Most of the acquisitions were brought in by the investors and we got carried away. Investors wanted us to launch in 40 countries together,” he explained. Several investors, including representatives from Peak XV Partners, Prosus, and the Chan Zuckerberg Initiative, exited BYJU’S board in June 2023 around the time GLAS Trust initiated legal proceedings in Delaware, fearing liability for the loan repayment.

Optimistic about resolving the insolvency issues, Raveendran remains confident of BYJU’S potential revival, noting, “Our subsidiary has not taken any hits. At a consolidated level we will have more than INR 5,000 crore in revenue. We are struggling in the core business which has become zero. Still there are 200 million kids who come to our platform every month. We have to revamp and revive.”

Despite the challenges, Raveendran emphasized his commitment to education, stating, “Whatever may be the result of litigation, I will continue to teach and nobody can stop me from teaching students.”