Embattled edtech firm Byju's faces yet another insolvency plea on a day when a $200 million rights issue floated by the company was fully subscribed. US-based non-bank loan agency Glas Trust Company filed an insolvency plea against the company at the NCLT in Bengaluru, the fourth such plea against firm in less than six months.
Glas Trust represents foreign lenders, who collectively extended more than 85 percent of Byju’s $1.2-billion term loan to the firm.
Earlier today, Byju's founder and CEO Byju Raveendran said in a shareholder letter that the company's rights issue to raise $200 million at a valuation cut of 99 percent has been fully subscribed.
BCCI, France-based Teleperformance Business Services, and digital marketing firm Surfer Technologies have also filed insolvency pleas against Byju's.
Earlier in the day, in a letter to shareholders, Byju Raveendran, who is also the unicorn's chief executive officer (CEO), said, "Our rights issue is fully subscribed and my gratitude to my shareholders remains strong."
"But my benchmark of success is the participation of all shareholders in the rights issue. We have built this company together and I want us all to participate in the renewed mission. Your initial investment laid the foundation for our journey and this rights issue will help preserve and build greater value for all stakeholders," he said.
Raveendran also said that to monitor the usage of funds raised in the rights issue, Byju's will appoint a third-party agency. "This agency will report the shareholders on a quarterly basis, within 45 days from the end of the quarter, along with commentary from the board," he said.
He said that he was committed to restructuring the board of the company and appointing two non-executive directors, adding that the audit of the financial results for 2022-23 is expected to be closed by the end of the current quarter.
Byju's board currently has Raveendran, his wife Divya Gokulnath and brother Riju Raveendran. The company is scheduled to have its Extraordinary General Meeting on February 23.