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Byju's $1.2-billion loan dispute: Court finds board member in contempt

The Arc Web

The Arc Web · 1y ago

Byju's $1.2-billion loan dispute: Court finds board member in contempt

Riju Ravindran, the brother of Byju's founder, has been found in contempt of court by a US judge for not disclosing the whereabouts of $533 million in term loan proceeds. Lenders are seeking to locate the funds from a $1.2 billion loan taken out in 2021. The judge ruled that Ravindran's testimony was not truthful and that he either knows where the funds are or is intentionally avoiding obtaining the information. Byju's, an edtech company, is currently facing legal challenges from lenders demanding repayment.

Related News

Byju's reaches settlement with BCCI, Riju Raveendran to pay Rs 158 crore pending dues

Economic Times

Economic Times · 1y ago

Byju's reaches settlement with BCCI, Riju Raveendran to pay Rs 158 crore pending dues

Byju's founder, Byju Raveendran, and the Board of Control for Cricket in India (BCCI) have settled their dispute over pending dues. The settlement amount, already partly paid, will be covered by Byju's board member, Riju Raveendran. However, US lenders against Byju's, who provided a $1.2 billion loan, have opposed the settlement. The National Company Law Appellate Tribunal (NCLAT) has requested evidence of the source of funds being paid to the BCCI. Byju's is currently under insolvency proceedings initiated by the National Company Law Tribunal. The dispute pertains to a jersey sponsorship agreement between Byju's and BCCI.

Byju’s, lenders postpone legal battle; aim for out-of-court solution

Livemint

Livemint · 1y ago

Byju’s, lenders postpone legal battle; aim for out-of-court solution

India's edtech giant Byju's is working towards resolving a dispute with lenders over a $1.2 billion loan raised in November 2021. The conflict started when Byju's failed to provide its audited FY22 financials on time, violating loan covenants. The company's refusal to pay interest led to allegations of "predatory tactics." Negotiations for an out-of-court settlement are ongoing, with discussions centered on new terms, including upfront payments and interest rates. The court has extended the deadline for response or dismissal of the original complaint to October 6. Both parties aim to resolve the dispute before Diwali (November 13).

US court pulls up Byju’s co-founder Riju Ravindran for concealing $533 mn

Livemint

Livemint · 1y ago

US court pulls up Byju’s co-founder Riju Ravindran for concealing $533 mn

Riju Ravindran, co-founder of edtech company Byju's, has been penalized by a US court for contempt of court. The court found Ravindran in contempt for refusing to disclose the location of $533 million in term loan proceeds that he transferred from Byju's Alpha Inc. The court has also prohibited further transfer or use of the loan proceeds. The financial penalties imposed on Ravindran will be announced in a future hearing. Byju's has faced multiple legal cases from investors, vendors, and bondholders, adding to its existing challenges.

NCLAT Likely To Rule On BYJU’S-BCCI Roe On Aug 2

Inc42 · 1y ago

NCLAT Likely To Rule On BYJU’S-BCCI Roe On Aug 2

Yesterday, the NCLAT put off its decision on approving the INR 158 Cr settlement between BYJU'S and the BCCI. Meanwhile, a US Bankruptcy Court has ordered Riju Ravindran, brother of Raveendran (BYJU'S founder), to pay $10,000 a day until he assists in locating $533 Mn that his company allegedly hid from US lenders. The dispute is centered around BYJU'S $1.2 Bn Term B Loan from US-based lenders.

NCLAT adjourns Byju’s case hearing to November 6

Economic Times

Economic Times · 10m ago

NCLAT adjourns Byju’s case hearing to November 6

- Case involving Byju's and US lenders adjourned to November 6 by NCLAT. - US lenders demand repayment of $1.2 billion loan from Byju's. - Supreme Court temporarily halts all meetings regarding Byju's insolvency proceedings. - Glas Trust moves apex court challenging its removal from Byju's committee of creditors. - Supreme Court instructs interim resolution professional to maintain status quo and not hold lenders' meeting. - Separate matter between Byju's investors and parent company adjourned to November 18 by NCLT.

Delaware Supreme Court says Byju's defaulted on $1.5 billion loan, favours US lenders

Economic Times

Economic Times · 10m ago

Delaware Supreme Court says Byju's defaulted on $1.5 billion loan, favours US lenders

The Delaware Supreme Court has upheld a ruling that edtech firm Byju's defaulted on a $1.5 billion loan, allowing lenders to demand full repayment and take control of Byju’s US entity. Byju's founders have acknowledged the default and signed multiple amendments to the credit agreement, according to the lenders. The court stated that Byju's must be held accountable and cannot distance itself from the defaults. The lenders also raised concerns about missing loan proceeds. Previously, the lenders demanded the repayment of $1.2 billion, alleging that Byju's had not made any contractually due payment for over 17 months.

Hedge fund manager faces arrest in US over $533 mn taken from Byju's

VCCircle

VCCircle · 1y ago

Hedge fund manager faces arrest in US over $533 mn taken from Byju's

William Cameron Morton, a hedge fund manager, is facing arrest in the US for allegedly helping Indian edtech startup Byju's hide $533 million from its lenders. Byju's Alpha, a subsidiary controlled by the lenders, filed for bankruptcy after the startup defaulted on $1.2 billion in debt. Upon investigation, it was found that the funds had been transferred to Morton's hedge fund, Camshaft Capital. The court ordered Morton's arrest, stating that he had shown contempt for the court and failed to cooperate with the investigation. Morton could also face fines of $10,000 per day until he complies with court orders.

Byju's term-loan lenders kick off bankruptcy proceedings against its US assets

Inc42 · 1y ago

Byju's term-loan lenders kick off bankruptcy proceedings against its US assets

The ad hoc group of lenders for Term Loan B have filed petitions for bankruptcy against Epic!, Neuron Fuel, and Tangible Play. They claim that BYJU'S founders unlawfully diverted $533 million in loan proceeds. Riju Ravindran was found in contempt by the Delaware Court for refusing to disclose the location of the funds.

Never Lent Any Money To BYJU’S, Claims IIFL Finance

Inc42 · 1y ago

Never Lent Any Money To BYJU’S, Claims IIFL Finance

IIFL Finance denies lending any funds to BYJU'S, contradicting BYJU'S claim of a INR 440.77 Cr loan in its FY21 financial statements. IIFL Finance called the mention an error by BYJU'S and confirmed no lending took place. BYJU'S faces challenges with two sets of lenders, Term Loan B (TLB) lenders and Davidson Kempner, over a $1.45 Bn loan. TLB lenders have postponed their legal battle, possibly for out-of-court negotiations, while BYJU'S and Davidson Kempner continue discussions on a loan covenant dispute settlement.

Facing insolvency, Byju's hit with new challenge from lenders

Economic Times

Economic Times · 1y ago

Facing insolvency, Byju's hit with new challenge from lenders

US-based Glas Trust is urging an Indian court to continue insolvency proceedings against ed-tech giant Byju's, as lenders it represents are owed $1 billion. Byju's, once valued at $22 billion, has faced numerous challenges including boardroom exits, an auditor resignation, and a dispute with foreign investors. The company is now facing insolvency after not paying the cricket board $19 million in sponsorship dues. Byju's former CEO claims the matter is settled, but Glas Trust alleges that the company used lenders' money to pay the cricket board. A court ruling in favor of Glas Trust could lead to further troubles for Byju's, including frozen assets and a potential shutdown.

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