Edtech unicorn Byju’s and its lenders have missed the August 3 timeline to rework the $1.2-billion loan agreement.
Byju Raveendran has a call with the lenders next week, a source familiar with the matter said, and added that the edtech major had never committed to any such date.
“The discussions are progressing well in the right direction, and are expected to close at the earliest. In fact, the next meeting with the lenders is scheduled for early next week. No deadline has been missed as August 3 was merely a hopeful date that was likely to be scheduled for a sign-off,” said a Byju’s spokesperson.
On July 24, Byju’s had agreed to rework the loan pact for its $1.2-billion Term B loan, with the lenders. The steering committee of ad hoc term loan lenders, who represent more than 85 per cent of Byju’s $1.2-billion term loan, said they would work with Byju’s and complete the term loan amendment by August 3.
“We look forward to completing the loan amendment over the next two weeks and are committed to doing our part to deliver on our agreed-upon timeline,” the steering committee said in a statement.
If the amendment goes through, it will promptly resolve the loan acceleration, end all ongoing litigation, and prevent additional enforcement actions, it had said.
Byju’s took a $1.2-billion term loan B for a tenure of five years with a yield to maturity (YTM) of 6.78 per cent in November 2021. The edtech firm skipped its $40-million loan repayment on June 5 of this year and later sued its lenders, alleging predatory tactics.
A Delaware court in the US gave a decision in favour of Byju’s as the court denied a request by term loan B lenders to investigate the matter of a $500-million transfer from its US-based subsidiary, Byju’s Alpha, to other entities.
The Chairman of Manipal Group, Dr. Ranjan Pai, is in discussions to invest in Byju’s-owned Aakash. Pai is expected to invest via his family office, according to a source close to the development.