In an internal email addressed to staff, BYJU’S said it has negotiated an alternate line of credit to ensure salaries are paid by April 18. BYJU’S once again targeted its “foreign investors” and accused them for being unable to access the proceeds of its $200 million rights sale. The National Company Law Tribunal has prohibited the edtech giant from accessing the proceeds of its rights issuance until further notice.
Economic Times was the first to report on the development.
This comes only days after the ed-tech company postponed paying employee salaries for the second month in a row owing to a cash problem. BYJU’S later announced that the pay would be cleared by April 8.
In the most recent email, the startup stated, “We are glad to inform you that compensation disbursement has begun today and will be finished within the next 10 days… We have set up an alternative line of credit to assure timely payments.”
It once again pointed its guns at its “foreign investors” and blamed them for being unable to access the profits of its $200 million rights offering.
“Unfortunately, due of the actions of four foreign investors, we haven’t yet received approval to access the rights issue funds, despite our best efforts… “We sincerely appreciate your patience and understanding throughout this period,” the email stated.
BYJU’S has repeatedly accused certain of its investors of being unable to access the cash from the $200 million rights sale. BYJU’S is currently undergoing a court struggle with various investors who want to prevent the rights offering and depose founder and CEO Byju Raveendran.
The National Company Law Tribunal (NCLT) has prohibited the startup from accessing the proceeds of the rights issuance until further notice. Just last week, the ailing ed-tech company requested arbitration to resolve a disagreement with investors over rights.
The dispute that arose between Raveendran and the company’s investors surfaced earlier this year when the latter called an extraordinary general meeting with the intention of unseating him and reorganizing the ed-tech company’s board. This happened shortly after the business announced a $200 million right issuance at a 99% valuation decrease to bridge the funding gap and settle unpaid vendor dues.
It is worth noting that the Karnataka High Court issued an order in February not to implement the resolutions voted at the EGM after BYJU’S filed a petition.
BYJU’S has often delayed crediting employees’ salaries in recent months due to a budget shortage and several court disputes. Last year, it even delayed submitting its employees’ PF contributions to the EPFO.
