The National Company Law Tribunal (NCLT) issued a notice to the parent company of Byju’s, Think&Learn, in response to a bankruptcy plea from Glas Trust Company LLC, a US-based non-bank loan agency. Byju’s has three weeks to file objections and two weeks thereafter to reply. Glas Trust alleges that Byju’s guaranteed a $1.2-billion loan for its US unit, Byju’s Alpha, but failed to respond to repayment requests, leading to the plea.
This is the fourth insolvency plea against Byju’s in six months. The plea, filed on January 22, was registered with the NCLT on February 21. Byju’s faces separate insolvency petitions from the Board of Control for Cricket in India (BCCI), France-based Teleperformance Business Services and digital marketing firm Surfer Technologies, along with TLB lenders and investors.
The NCLT’s action follows a plea of oppression and mismanagement against Byju’s by four investors, including MIH Edtech Investments BV, Peak XV Partners Investments IV & V, Sofina S A and General Atlantic Singapore TL. The group sought a stay in Byju’s $200 million rights issue, initiated at the end of January.
The tribunal also notified the Ministry of Corporate Affairs (MCA) and Registrar of Companies about the matter. Byju’s is directed to hold funds from the rights issue in escrow until the resolution of the oppression and mismanagement plea, and to consider extending the rights issue. The tribunal reserved judgement on staying the rights issue and instructed parties to submit written arguments.
However, sources close to the development said that the rights issue closed on Wednesday.