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HomeTechByju’s ED probe: Byju Raveendran tells staff all cross-border transactions duly vetted

Byju’s ED probe: Byju Raveendran tells staff all cross-border transactions duly vetted

In the backdrop of an investigation by India’s federal financial probe agency Directorate of Enforcement (ED), edtech startup Byju’s founder and chief executive Byju Raveendran wrote to the company’s employees saying all of its cross-border transactions have been duly vetted by professional advisors and counsels.

ET has reviewed a copy of the email sent to Byju’s employees late Saturday.

The ED has conducted search and seizure actions on several premises linked to the company in Bengaluru. ED had conducted these searches as part of a probe into alleged violation of foreign exchange rules around the investments received and transfer of funds abroad by the edtech firm.
Meanwhile, India’s most valuable startup at $22 billion, said the searches were related to a routine inquiry under FEMA (Foreign Exchange Management Act).

Raveendran, in an email to employees, said the recent ” visit by the ED” is an enquiry under FEMA, adding that the “information requested by and furnished to the officers in connection with the FDI raised, overseas investments made, and cross-border transactions relating to marketing and branding activities by Byju’s has previously been submitted by our authorised representatives.”

He said the company has made a number of overseas acquisitions (investing an amount of approx. Rs 9,000 crores) over the years and to fund these acquisitions, the company remitted “some of our funding overseas.“

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Also read: Byju’s acquires US edtech firm Epic in $500-million deal

Raveendran further said the edtech major brought “more FDI to India than any other Indian startup (Rs. 28,000 crores)”, and created job opportunities for “more than 55,000 talented professionals.”

“Byju’s has taken all efforts to fully comply with all applicable foreign exchange laws and all our cross-border transactions have been duly vetted by both its professional advisors/counsel and advisors/counsel of the investment funds and other sophisticated counterparties,” he said.

Also read: Byju’s losses swell to Rs 4,588 crore in delayed FY21 results

“Additionally, all such transactions are routed only through regular banking channels/the RBI’s authorised dealer banks and the requisite documentation and statutory filings have been duly submitted.”

“I want to reassure you that we are fully cooperating with the authorities”, he added.

“As we are funded by 70+ impact investors who have satisfactorily done due diligence on our operations, including all FEMA compliance, we are confident that the authorities will also come to the same conclusion”, he wrote.

Also read: Byju’s lenders seek $200 million prepayment over restructuring $1.2 billion loan

In a press statement on Saturday, the ED said it was cross-checking with banks the genuineness of the figures provided by the company. The agency also said it had summoned Raveendran several times but he remained “evasive”.

According to the ED, its searches revealed that Think & Learn, the parent company of Byju’s, had received foreign direct investments of Rs 28,000 crore during 2011 to 2023, when it also remitted around Rs 9,754 crore to various foreign jurisdictions “in the name of overseas direct investment”.

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