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Embattled edtech major Byju’s has successfully closed its $200 million rights issue, but the company has again delayed salary payments to the employees.
In a letter to the employees, Co-founder and CEO Byju Raveendran said that because of a few investors the company would not be able to pay the salaries for February. He said that the proceeds of the rights issue have been parked in a separate account. businessline has a copy of the letter. “Unfortunately, a select few (4 out of our 150-plus investors) have stooped to a heartless level, ensuring that we are unable to utilise the funds raised to pay your hard-earned salaries. At their behest, the amount raised through the rights issue is currently locked in a separate account,” he said.
Raveendran said that the company is ‘striving to ensure that salaries are paid by 10 March.
This comes at a time when the Bengaluru bench of NCLT asked the company to keep the proceeds from rights issue in a separate escrow account and consider extending the rights issue. Four investors — Prosus, Peak XV Partners, General Atlantic and Sofina filed a suit seeking to declare the founders as unfit to run the company, appoint a new board, declare the rights issue as void, and conduct a forensic audit, as reported by businessline.
“It is an agonising reality that some of these investors have already reaped substantial profits — in fact, one of them has made a staggering eight times their initial investment in BYJU’S,” the email said.
Other NCLT cases
Recently, NCLT also asked the edtech major to respond to insolvency petitions filed by US lenders and the Board of Control for Cricket in India (BCCI).
The NCLT bench has given Think & Learn, Byju’s parent company, three weeks to file its objections to the insolvency petition filed by Glas Trust Company LLC, the administrative agent appointed by the TLB lenders to its US subsidiary Alpha Inc. It has also asked the Glas Trust Company LLC to issue a notice to Byju’s for payment defaults of the loan that it had guaranteed along with a copy of the petition it filed in the bankruptcy court.
In a separate hearing, the BCCI lawyer told the NCLT that Byju’s has not yet paid the pending due of ₹156 crore. The BCCI lawyer argued that Byju’s had already withheld tax deducted at source (TDS) against invoices that it received from BCCI, but it never paid the invoice amount to the cricket board.
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