Edtech Startup Byju’s Faces Deadline for $40 Million Payment

According to those acquainted with the situation, Edtech Startup Byju’s, the most valuable startup in India, intends to pay a loan that has been the source of the company’s financial woes a $40 million interest payment each quarter.

According to the individuals who requested anonymity due to the nature of the information being private, the edtech company anticipates paying on Monday to meet the deadline of June 5. Plans may be modified because the problem is still a shifting target. If the $1.2 billion loan is not repaid on time, it will default. 

Requests for comment regarding the coupon payment received no response from Byju’s. Houlihan Lokey Inc. representatives declined to comment after being contacted by creditors to advise them on the loan. 

The $1.2 billion in debt owed by the firm is the biggest unrated debt in history. Since the pandemic-era surge in online tutoring took a toll on its finances, the once-promising company managed by former teacher Byju Raveendran has been working with lenders to restructure the debt. 

According to Bloomberg’s article from last week, the lengthy negotiations were terminated because the creditors wanted a quicker repayment schedule. The individuals claimed that the lender group had an arrangement of collaboration in place requiring them to work together while in negotiations. 

According to statistics gathered by Bloomberg, the loan, which plunged to a record low of 64.5 cents per dollar in September, is currently valued at roughly 78 cents.

The company will have enough breathing room to wait for “a large capital infusion” that its attorney claimed will be used to pay down the loan if it makes the coupon payment on time. All debt payments have, in the corporation’s opinion, been made on schedule, so any defaults should be seen as minor technical breaches of the loan agreement.

India’s agency that looks into infractions of the country’s foreign exchange laws examined the firm’s premises because it missed deadlines to file financial reports for the year ending on March 31.