BYJU’S and its lenders have failed to meet the August 3 timeline for signing an amendment to the terms of the edtech giant’s $1.2 billion Term Loan B (TLB), creating uncertainty for the startup. While the startup has stated that talks for the amendment are progressing in the right direction, the official signing is yet to take place.
SteerCo’s Commitment and BYJU’S Response
The steering committee (SteerCo) of the ad hoc lenders, who collectively hold 85% of the TLB, had committed to signing and completing the amendment by August 3. However, BYJU’S did not make any such commitment to adhere to this timeline. According to a spokesperson, discussions are ongoing and are expected to close soon. The next meeting with the lenders is scheduled for early next week.
BYJU’S CEO to Hold Talks with Lenders
BYJU’S CEO Byju Raveendran is scheduled to hold talks with the lenders in the coming week. The spokesperson clarified that August 3 was not a strict deadline but rather a hopeful date for a sign-off. It appears that both parties are working towards reaching a resolution.
Controversy Surrounding the TLB
The TLB, acquired by BYJU’S in November 2021, has been marred by controversy since December. Litigation between the startup and its lenders escalated with allegations of non-monetary and technical defaults. In May, the lenders sued Byju’s Alpha, a wholly-owned subsidiary, claiming it concealed $500 million from them. the startup countersued the lenders in the New York Supreme Court, challenging the TLB acceleration, and also missed a payment of $40 million.
Uncertainty Lingers for BYJU’S and Davidson Kempner
Aside from the ongoing TLB issues, BYJU’S is reportedly facing a tussle with Davidson Kempner, which provided $250 million in debt funding to the company earlier this year. Davidson Kempner has purportedly taken control of Aakash, another edtech firm, but details remain confidential. The situation adds further complexity to the startup’s current challenges.
Also Read The latest News:
Piyush Goyal meets senior Tesla executives to discuss manufacturing plant plans
The post BYJU’S misses deadline for signing amendment to $1.2 billion term loan appeared first on StartupNews.fyi.
