Byju’s faces financial turmoil as NCLT issues notices over unpaid dues, involving key vendors and leadership changes. Read more about Byju’s legal and internal struggles.
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Byju’s
The National Company Law Tribunal (NCLT) has issued notices to Think and Learn Pvt Ltd, the parent company of Byju’s, in three cases regarding non-payment of dues to operational creditors. The embattled EdTech giant is grappling with a financial crisis and ongoing litigation involving at least seven vendors.
Key Litigations and Financial Struggles
Byju’s is embroiled in legal battles with several vendors, highlighting its acute financial distress. The latest cases were filed by:
- McGraw Hill: Claims unpaid dues of Rs 1.43 crore.
- Cogent E-services: A BPO service provider, claiming approximately Rs 6 crore in dues.
- AG Automation: Supplier of automation control products.
The hearings for these cases are scheduled for July 3. Byju’s is given two weeks to respond, and the petitioners have another week to file a rejoinder.
| Vendor | Claimed Dues | Hearing Date |
|---|---|---|
| McGraw Hill | Rs 1.43 crore | July 3 |
| Cogent E-services | Rs 6 crore | July 3 |
| AG Automation | Not Specified | July 3 |
Internal Turmoil and Leadership Changes
The situation has further deteriorated with internal conflicts and key resignations. Byju’s recently appointed CEO Arjun Mohan and CFO Ajay Goel have stepped down. Additionally, investor board members have exited, citing differences with founder and CEO Byju Raveendran.
The company had attempted to stabilize by forming an advisory council including veterans like Mohandas Pai and Rajnish Kumar. However, both advisors plan to step down after their contracts expire in June.
Employee Grievances and More Legal Challenges
Adding to the woes, a group of employees has appointed a lawyer to demand their dues from Byju’s through the NCLT. This follows a report by Moneycontrol highlighting the employees’ intent to take legal action.
Historical Legal Challenges
Byju’s legal battles started with the Board of Control for Cricket in India (BCCI), which filed the first insolvency plea in November 2023, alleging a default of Rs 158 crore. This case is now at an advanced hearing stage at the NCLT. Following this, additional insolvency pleas were filed by:
- Teleperformance Business Services: A France-based company.
- Glas Trust Company: The lenders.
- Surfer Technologies: A digital marketing firm.
| Entity | Claimed Amount | Stage of Hearing |
|---|---|---|
| BCCI | Rs 158 crore | Advanced |
| Teleperformance Business Services | Not Specified | Initial |
| Glas Trust Company | Not Specified | Initial |
| Surfer Technologies | Not Specified | Initial |
Conclusion
Byju’s, once a beacon of India’s EdTech sector, is now facing a challenging period marked by financial instability, legal disputes, and internal disarray.
As the company navigates these tumultuous waters, the industry watches closely, hoping for resolutions that might pave the way for recovery and stability.
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