This comes a day after the NCLAT reportedly postponed its decision on approving the INR 158 Cr settlement between BYJU’S and the BCCI
Bloomberg reported that a US Bankruptcy Court ordered Riju Ravindran, brother of Raveendran, to pay $10,000 a day until he helps locate $533 Mn that his company is accused of hiding from US lenders
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
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The National Company Law Appellate Tribunal (NCLAT) has reportedly stayed the formation of the Committee of Creditors (CoC) till tomorrow on a tussle between embattled edtech startup BYJU’S founder Byju Raveendran and the Board of Control for Cricket in India (BCCI).
The tribunal is expected to rule on the settlement between Raveendran and BCCI on August 2 and the stay is intended ‘to protect the interest of all the parties’ till an order is passed, as per Moneycontrol’s report.
Meanwhile, Bloomberg reported that a US Bankruptcy Court ordered Riju Ravindran, brother of Raveendran, to pay $10,000 a day until he helps locate $533 Mn that his company is accused of hiding from US lenders.
This comes a day after the NCLAT reportedly postponed its decision on approving the INR 158 Cr settlement between BYJU’S and the BCCI after the embattled edtech startup’s US-based lenders raised allegations, questioning the source of the capital.
As part of the NCLAT hearing, Riju told the court that he is paying BCCI from the funds generated from the sale of his Think and Learn shares between 2015 and 2018, which is not part of the $533 million owed to US lenders.
Puneet Bali, who represents BYJU’S, clarified Riju’s stance on paying BCCI, saying, “Riju earned Rs. 3,600 crore from the sale of his shares in the company, and he paid income tax of over Rs. 1,000 crore on the same.”
Much to the anticipation, US lenders objected to Riju’s claim, alleging that the ‘math did not add up.’ Senior advocate Mukul Rohatgi, who represents the lenders, pointed out that the two Raveendrans voluntarily filed for insolvency in the US, and there is nothing on record to show that they have any money.
According to the report, 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.
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.
BYJU’S, once the poster child of the Indian startup ecosystem, is battling multiple issues, including mass layoffs, a severe cash crunch, delay in filing financial statements, a slew of legal cases and mounting regulatory scrutiny. Making matters worse is a public spat with investors even as losses continue to mount for the company.
BYJU’S net loss surged 81% year-on-year YoY to INR 8,245.2 Cr in FY22.
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