Byju’s Alpha, the education technology firm, is facing a lawsuit from a lender’s agent for $1.2 billion, following months of negotiations between creditors and the company, as reported by Bloomberg on Thursday. The lawsuit was filed by Glas Trust Company and investor Timothy R. Pohl against Byju’s Alpha, Tangible Play, Inc., and Riju Ravindran.
In response, Think and Learn Private, the ed-tech giant founded by Byju Raveendran, has filed a lawsuit against the two firms. It was noted in the regulatory filing that Ravindran is a director of Think and Learn.
Details regarding the complaint and the intentions of Glas Trust and Pohl have been redacted in the court filings. However, one filing suggests that the case may be related to a dispute over the election of directors, although specific charges were not provided.
A judge in Wilmington, Delaware, has scheduled a telephone hearing for Thursday to determine whether the case should be expedited. The lawsuit was reportedly filed earlier this month in Delaware.
Delaware Chancery Court Judge Morgan Zurn denied the request by Ravindran and Byju’s to close the hearing to the public. In a public filing quoted by Bloomberg, Judge Zurn stated that the defendants had not met the burden required to deviate from the constitutional requirement for the court to be open to the public.
Earlier this year, Byju’s reportedly requested more time from lenders to restructure a $1.2 billion loan that was in breach of covenants. Lenders objected to the company’s proposal to restructure the debt by increasing the interest rate on the term loan due in 2026.
Byju’s was already working on refinancing the loan to appease creditors before an anti-money laundering investigation began in April. Recently, anonymous sources familiar with the matter revealed that Byju’s raised $250 million in fresh funding and is close to securing an additional $700 million, with investment firm Davidson Kempner reportedly contributing $250 million through structured instruments.
As of now, neither Byju’s founder Raveendran nor company director Ravindran have responded to the lawsuit.
Post Your Comments