Byju’s delays staff salaries amid rights issue dispute with investors: Report
Byju's has delayed the salaries of its staff for the second month in a row, reported Business Standard, after having seen a copy of the letter sent by management to the employees on Monday.
“We are writing to you today with a heavy heart but with a message of hope and reassurance. We regret to inform you that there will again be a delay in the disbursement of salaries,” said Byju's management in the letter sent to employees, as per the report.
The development comes amid an ongoing disagreement with shareholders regarding the edtech company's rights issue.
Byju's has promised its employees that it is arranging an alternative line of credit to ensure salaries are paid by April 8.
“A few misguided foreign investors in Byrju’s have obtained an interim order in late February, restricting usage of the funds raised through the successful rights issue. This irresponsible action by the four foreign investors has compelled us to temporarily hold the disbursal of salaries until the restriction is lifted,” the letter added.
Byju's and its investors are engaged in a legal tussle at the National Company Law Tribunal (NCLT) regarding the company's $200 million rights issue, with a petition claiming unfair treatment and mismanagement.
The investors, including Prosus, General Atlantic, Sofina, and Peak XV (previously Sequoia), requested a halt on the rights issue, concerned that its valuation, set at less than 99% of Byju's peak valuation of $22 billion, might diminish their investment's worth.
