BENGALURU: Edtech firm Byju’s, embroiled in a legal tussle with its lenders over $1.2 billion term loan B (TLB), has started one-on-one talks with the lenders.
According to the people aware of the matter, the ed-tech firm has already completed a few discussions with them and these talks are to find mutually beneficial resolutions among lenders and the firm.
These discussions are being done with a majority of the lenders. Sources also said that these discussions are very crucial to the country’s most valued ed-tech firm.
Earlier it was reported that lenders were not ready to engage in the ed-tech firm’s one-on-one meetings, but now sources said they have lined up individual meetings with the lenders.
Last week, Byju’s filed a complaint in the New York Supreme Court to challenge the acceleration of the USD 1.2 billion (the firm secured this loan in November 2021) and also sought to disqualify Redwood, an investment management firm.
The company alleged that a series of predatory tactics were conducted by the lenders, led by Redwood.
The ed-tech firm also elected not to make any further payments on the loan including interest until the dispute with lenders was decided by the court. It skipped paying $40 million in interest last week.
Immediately, a group of ad hoc term loan lenders, who collectively own more than 85 per cent of the firm’s $1.2 billion term loan, called it a meritless lawsuit.
The lender group, comprised of 21 global institutional investors, had sought to work constructively with the company over the past nine months to cure its numerous defaults and it said they will continue to do so in good faith.
In the first week of June, Byju’s said it will launch the initial public offering (IPO) of Aakash in mid-2024. It said that Aakash has clocked a three-fold increase in revenue in the last two years.
The ed-tech major last month raised USD 250 million in a fresh funding round. It is yet to file its FY22 results, but sources said the company will announce the same soon.