Indian EdTech giant, Byju’s Alpha, has been sued by an agent for lenders owed $1.2 billion after months of negotiations between creditors and the company. Glas Trust Company and investor Timothy R. Pohl filed the action against Byju’s Alpha, Tangible Play, Inc., and Riju Ravindran.
Think and Learn Private, which is the edtech giant founded by Byju Raveendran, is suing the two companies. The regulatory filing noted that Ravindran is a director of Think and Learn.
The court filings have been redacted with details as to why the complaint was filed and what the Glas Trust and Pohl want. A filing suggests that the case may be related to a fight over the election of directors, although it does not include specific charges.
According to Bloomberg report, a Wilmington judge has scheduled a telephone hearing for Thursday to decide whether to expedite the case. The lawsuit was reportedly filed there earlier this month.
The report mentions that Ravindran and Byju’s request to close Thursday’s hearing to the public was denied by Delaware Chancery Court Judge Morgan Zurn. Zurn said in a public filing: “The defendants seek to keep the events at the crux of this case hidden but have only speculated that their disclosure may cause harm.”
Byju reportedly sought more time from lenders earlier this year to restructure an agreement regulating a $1.2 billion loan in breach of covenants. According to people familiar with the case, lenders opposed restructuring its debt by raising interest rates on term loans due 2026.
Before an anti-money laundering investigation began in April, Byju’s strove to please creditors in refinancing its loan.
Recently TechCrunch reported that Byju raised $250 million in new funding and is close to raising another $700 million through structured instruments from New York-based investment firm Davidson Kempner.
So far, neither founder Raveendran nor company director Ravindran has responded.
It is disclosed that, Byju’s Alpha was sued by an agent for lenders owed $1.2 billion after months of negotiations between creditors and the edtech company.