Byju's Pays Delayed Salaries After Two Months

9 Apr 2024 , 10:34 AM

Salary payments were resumed by Edtech company Byju’s after a two-month delay. This occurs concurrently with the company’s inability to use the cash from a recently launched rights offering. “We are pleased to inform you that salary disbursement has commenced today and will be completed over the next 10 days,” the company wrote in an email to staff members. It added that permission to access the monies from the rights issue has not been obtained.

Funds from the rights issue will be held in an escrow account until the National Company Law Tribunal (NCLT) decides how to handle a plea filed by four of the company’s investors: Prosus NV, Peak XV Partners, General Atlantic, and Sofina SA. These investors have all objected to the company’s decision to raise $200 million at a post-money valuation of $225 million.

To guarantee on-time payments, we have set up a backup credit line. They said, “We truly appreciate your understanding and patience during this time.

Due to a severe financial problem, Byju’s postponed paying employee salaries while it awaited approval from the National Company Law Tribunal (NCLT) to use proceeds from the rights issue. Aakash, a test-prep company owned by Byju, named Deepak Mehrotra, a former managing director of Pearson India, as its new CEO. In an equity and cash transaction that included 30% stock and 70% cash, Byju’s purchased Aakash in April 2021.

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