Byju’s ongoing insolvency saga has taken a new turn, with US-based lenders contesting founder Byju Raveendran’s assertion that the company's verified debt is only Rs 20 crore. Glas Trust, representing the US lenders, has countered this claim, stating that the ed-tech giant must repay the full $1.2 billion Term B Loan, plus interest.
The loan, secured by Byju’s in November 2021, was intended to support its global expansion efforts. However, financial troubles emerged in June 2023 when US lenders filed a lawsuit seeking to recover the loan. Byju’s debt crisis has since escalated, compounding the company's already precarious situation.
Legal and Financial Struggles
Adding to its woes, Byju’s is embroiled in legal disputes. In August, the Supreme Court stayed the National Company Law Appellate Tribunal’s (NCLAT) approval of a settlement between Byju’s and the Board of Control for Cricket in India (BCCI) over unpaid sponsorship dues of Rs 158 crore. The Supreme Court will hear the case on September 17, further delaying a resolution for the troubled company.
Byju’s financial struggles mirror those of other ed-tech companies like Unacademy and Toppr, which have seen significant losses as demand for online education declined post-pandemic.
Future of Ed-Tech in India
Despite Byju’s struggles, the ed-tech sector in India continues to show potential. Experts like Anil Nagar, CEO of Adda247, remain optimistic about the future of online education. Recent fundraising by PhysicsWallah, which secured $150 million, highlights ongoing interest in the sector, even as investors proceed with caution in light of Byju’s financial crisis.