Byju's, a prominent edtech company, has faced challenges with its staff salaries for the second consecutive month, according to a report from Business Standard. Management sent a letter to employees, expressing regret over the delay in salary disbursement and assuring them of efforts to arrange alternative funding to ensure salaries are paid by April 8.
The delay in salary payments coincides with an ongoing dispute between Byju's and its shareholders regarding the company's rights issue. Byju's management attributed the salary delay to an interim order obtained by certain foreign investors in late February, which restricted the use of funds raised through the rights issue. This restriction compelled the company to temporarily hold the disbursal of salaries until the issue is resolved.
The disagreement between Byju's and its investors has escalated to the National Company Law Tribunal (NCLT), with investors such as Prosus, General Atlantic, Sofina, and Peak XV (formerly Sequoia) expressing concerns about the valuation set for the rights issue. These investors fear that the valuation, which is less than 99% of Byju's peak valuation of $22 billion, may diminish the worth of their investment.
The situation underscores the complexity of managing financial matters amidst legal disputes and highlights the challenges faced by companies operating in the dynamic landscape of the edtech industry.
