Vendors Ramp Up Claims Against BYJU’s at NCLT, Totaling Rs 190 Crore

• ByStartupStory     |    May 4, 2024

The total claims lodged by vendors against the embattled edtech giant BYJU’s at the National Company Law Tribunal (NCLT) have now reached Rs 190 crore, following a new claim of Rs 1 crore by smartphone manufacturer Oppo. This development adds to the woes of BYJU’s, which is already in a tight spot as it struggles to unlock Rs 200 million in funds from a recent rights issue due to ongoing disputes with its investors.

According to informed sources, “The total claim of Rs 190 crore has been filed against BYJU’s before the NCLT. This includes Rs 1 crore claim filed by Chinese mobile company Oppo.” The largest portion of these claims comes from the Indian Cricket Board (BCCI), which has filed for a staggering Rs 158.9 crore. Other significant claims include Rs 6.7 crore from Cogent E-Services and Rs 5 crore from Teleperformance Business Services, among others.

The issue is further complicated as the claims are under dispute, with sources indicating that “All the claims are under dispute, and actual dues will be less.” This statement suggests a complex legal battle ahead for BYJU’s as it works through these financial and legal challenges.

In an effort to resolve some of its funding issues, BYJU’s had completed a Rs 200 million rights issue in February, which was marked by a dramatic 99% drop in valuation from its peak enterprise value of Rs 22 billion. This drastic revaluation has raised eyebrows and added layers of complexity to the firm’s ongoing financial strategies.

A coalition of investors including Prosus, General Atlantic, Sofina, and Peak XV, supported by other shareholders like Tiger and Owl Ventures, has taken a stand against the company management and the structuring of the rights issue, bringing the matter to the NCLT.

Despite these challenges, a majority of BYJU’s shareholders recently backed the company’s resolution to increase its authorised share capital, which is aimed at incorporating the funds raised through the rights issue.

The NCLT Bengaluru is scheduled to revisit this multifaceted case on June 6, where the future course for BYJU’s may be further defined amid these significant financial and operational hurdles. The ongoing legal disputes and financial restructuring efforts are being closely watched by industry observers and stakeholders alike.

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