BYJU’S faces a deadline to pay $40 mn today to its creditors

Indian edtech major BYJU’s is expected to pay a $40-million instalment on its $1.2-billion loan on Monday. The firm expects to meet the deadline, people familiar with the matter told Bloomberg. The situation is fluid and the plans could change, the report noted.

Moreover, the sources also revealed that failure to pay the instalment would mean a loan default. 

This is the largest unrated loan by a start-up ever. Additionally, the company’s founder Byju Raveendran has been trying to strike a deal with creditors for a long time now in a bid to restructure the term loan. These developments come against the backdrop of the edtech major struggling with the post-pandemic decline in online courses as the industry has adopted a hybrid approach.

But the lenders demanding the repayment scrapped the long-running negotiations, Bloomberg reported last week. The lender consortium has signed a cooperation agreement that binds them to act together in negotiations, sources said.

The loan, which slumped to a record low of 64.5 cents to a dollar in September, is now quoted at around 78 cents, according to data compiled by Bloomberg.

Apart from the loan, BYJU’s has also been hitting the headlines for missing the deadline to file its financials for FY22. Recently, its offices were also searched by the Enforcement Directorate (ED). The ED said the company was being vetted in relation to the foreign direct investment to the tune of Rs 28,000 crore, which the edtech major received between 2011 and 2023. The agency further said that the company remitted Rs 9,754 crore to various foreign jurisdictions during the same period in the name of overseas direct investment.

BYJU’s did not respond to the requests for comments on the instalment payment. Representatives for Houlihan Lokey Inc., which was hired by creditors to advise them on the loan, declined to comment as well.

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