Byju's Crisis: Founder Byju Raveendran assures executives of company's turnaround initiatives

Byju's Crisis: Amid the ongoing cash crunch in edtech Byju's, its founder Byju Raveendran in a conference call assured all the company executives regarding the company’s current turnaround initiatives.

Byju's $1.2 billion Term Loan B

In the call, Raveendran reiterated that the major issue faced by the company is the legal tussle in the $1.2 billion Term Loan B it acquired from US lenders. As per Business Today, he said thet the issue originated from a delayed audit and demand for a full refund from lenders.

Also Read:Byju's lenders win fight over $1.2 billion loan default, to take control over Byju's U.S subsidiary Alpha

He further added that the company is engaged in active negotiations while expressing his optimism over the sale of Byju's US based subsidiary Epic- a kids-focused digital reading platform it acquired in 2021. Raveendran has said that this sale would help the company in resolving the issue.

Along with this, he also assured the company executives that the fund raised through the sale would help in easing the liquidity crunch faced by the company.

Expressing regret for the limited face time with the team, he stated, as per an individual privy to the meeting discussions, “My regret is that I am letting down a wonderful team by not providing adequate capital.”

ED threat for Byju's

In the call, Raveendran also identified the ED notice and the delay in closure of the FY23 statutory audit as other key challenges. The Enforcement Directorate had said that Byju’s violated Foreign Exchange Management Act norms by delaying the filing of documents against the foreign investment of about Rs 8,000 crore and failing to allot shares against these.

Also Read: Byju's denies reports of a ₹9,000 crore FEMA violation notice from ED

However, he reassured that significant progress has been made in resolving these issues, with procedural deficiencies addressed under FEMA for the ED notice and the FY23 audit on track for a completion.

Meanwhile, he said the capital invested by Ranjan Pai has settled Davidson Kempner's debt exposure in Aakash Education. He said that Aakash is now set for a record-breaking admissions season.

In a bid to boost the morale and get the support of the company leaders, Raveendran drew a parallel for the crisis with that of a war.

“A true entrepreneur is a war leader,” he said. “What Byju’s is going through can only be seen as a war on multiple fronts against all odds,” he added.