Byju’s saga: Salaries delayed, US unit files for bankruptcy
New Delhi, Feb 2 (IANS) Embattling edtech company Byju’s has reportedly delayed salaries of its employees for the month of January, as the firm aims to raise funds through a rights issue.
The company had earlier listed February 1 for the January salary pay-out for its employees, which has now been delayed and there is no communication, according to sources.
In December, the company had assured its employees their salaries would be credited on the first day of every month.
The company was yet to comment on the salary delay. The news was first reported by MoneyControl.
The salary delay comes as the Byju’s Alpha unit in the US has filed for Chapter 11 bankruptcy proceedings in the US court of Delaware, listing liabilities in the range of $1 billion to $10 billion.
Reports also surfaced that Byju’s investors are seeking to oust the top bosses of the company led by Byju Raveendran, saying they are ‘deeply concerned’ about future stability under the current leadership.
The investors are seeking an extraordinary general meeting (EGM) to adopt resolutions on outstanding governance, financial mismanagement and compliance issues, according to earlier reports.
The board consists of founder and CEO Byju Raveendran himself, his co-founder and wife Divya Gokulnath, and his brother Riju Ravindran.
Think and Learn Private Limited (TLPL), the parent company of Byju’s, earlier this week announced to raise $200 million by way of a rights issue to all its equity shareholders, in its bid to achieve operational sustainability.
The proposed rights issuance aims to fund the ongoing capital expenditure and support general corporate purposes, the company said in a statement.
According to reports, the edtech major is going to raise funds at a drastic valuation cut of around $250 million, from its all-time high of $22 billion market valuation in 2022.
As the largest shareholders, the founders of BYJU’S have invested more than $1.1 billion in the last 18 months.
Overseas lenders of Byju’s $1.2 billion term loans have also filed a petition before the Bengaluru Bench of the National Company Law Tribunal (NCLT) to initiate corporate insolvency resolution proceedings against Think & Learn Pvt Ltd.