BENGALURU: Edtech firm Byju’s, which has been conducting one-on-one talks with term loan B (TLB) lenders for some time now, has decided to postpone the disagreement with its lenders in the US courts until October 6. With this, both (lenders and Byju’s) have time to negotiate an out-of-court solution.
In June, the company elected not to make any further payments on a $1.2 billion TLB, including any interest until the dispute with lenders is decided by the court. It had filed a complaint in the New York Supreme Court to challenge the acceleration of the $ 1.2 billion TLB and also sought to disqualify Redwood, an investment management firm.
The edtech company had raised the term loan in November 2021 and it had alleged that a series of predatory tactics were conducted by the lenders, led by Redwood. In March this year, the TLB lenders “unlawfully” accelerated the TLB on account of certain alleged non-monetary and technical defaults, Byju’s claimed. Subsequently, a group of ad-hoc term loan lenders said Byju’s meritless lawsuit against its term loan lenders is an effort to avoid complying with its obligations, including making contractually required payments.
They collectively own over 85% of Byju’s $1.1 billion term loan. After these challenges, Byju’s started individual talks with the lenders to find mutually beneficial resolutions among lenders and the firm. It had missed the August 3 timeline set by its creditors. But now, the parties have agreed to delay the legal battle till October 6.
PARTIES TO THE DISPUTE GET MORE TO NEGOTIATE
With this, both (lenders and Byju’s) have time to negotiate an out-of-court solution. In June, the company elected not to make any further payments on a $1.2 billion TLB, including any interest until the dispute with lenders is decided by the court. The edtech company raised the term loan in November 2021