Ravindran is slated to pay the sum until he helps locate $533 Mn that his company is accused of hiding from US lenders
A judge at the US Bankruptcy Court of Delaware also dismissed his plea to put the order on hold until the company could find new lawyers
The current legal representation of Ravindran and BYJU'S deciding to move away from the dispute, blaming an "irreparable breakdown"
Inc42 Daily Brief
Stay Ahead With Daily News & Analysis on India’s Tech & Startup Economy
A US Bankruptcy Court has reportedly ordered Riju Ravindran, brother of BYJU’S founder Byju Raveendran, to pay $10,000 a day until he helps locate $533 Mn that his company is accused of hiding from US lenders.
According to a report by Bloomberg, the matter was being heard by US Bankruptcy Court of Delaware’s Judge Brendan Shannon who also dismissed Ravindran’s plea to put the order on hold until the company could find new lawyers.
This came as a result of the current legal representation of Ravindran and BYJU’S deciding to move away from the dispute, blaming an “irreparable breakdown”. As of now, the judge has directed their lawyers to continue appearing for Ravindran until at least a month.
With this, the company’s issues overseas are seemingly coming to a head. At the heart of the rift between the edtech company and its US-based lenders is the edtech giant’s $1.2 Bn Term B Loan from a host of lenders based in the US.
From the loan, the $533 Mn in question is linked to BYJU’S Alpha Inc., a bankrupt shell company affiliated with Think & Learn. This shell company was taken over by the lenders after a loan defaulted. The lenders are now leveraging the bankruptcy case of BYJU’S Alpha Inc. to recover the missing cash.
In this case, Ravindran was previously found in contempt of court at a show cause hearing in May. He was found in contempt because of his repeated refusal to disclose or ascertain the whereabouts of $533 Mn in term loan proceeds transferred from BYJU’s Alpha, Inc.
Besides taking the matter of the syphoned money up in the US, the US based lenders have also taken the matter up in India. They, collectively represented by GLAS Trust, filed an insolvency plea against the company with the Bengaluru bench of the National Company Law Tribunal (NCLT) earlier this year.
That case has also come to a head as the tribunal admitted an insolvency plea against BYJU’S. But this was not the insolvency plea of the US lenders, but of the Board of Control for Cricket in India (BCCI). As of now, the matter is currently being heard at the National Company Law Appellate Tribunal (NCLAT), which postponed its decision yesterday on the matter.
Note: We at Inc42 take our ethics very seriously. More information about it can be found here.