Byju's delays staff salaries for second month amid row with investors over rights issue

Edtech company Byju's has reportedly delayed March salaries to its employees for the second month in a row amid an ongoing dispute with shareholders over the firm's rights issue. 

Byju's has assured its staff that it is working on a parallel line of credit to ensure salaries are paid by April 8.  The company had held back February salaries mid-March. It later paid a part of the dues. 

“We are writing to you today with a heavy heart but with a message of hope and reassurance. We regret to inform you that there will again be a delay in the disbursement of salaries,” Byju's management said in a purported letter sent to employees.

“A few misguided foreign investors in Byrju’s have obtained an interim order in late February, restricting usage of the funds raised through the successful rights issue. This irresponsible action by the four foreign investors has compelled us to temporarily hold the disbursal of salaries until the restriction is lifted,” the letter added.

Byju's and its investors are involved in a dispute at the National Company Law Tribunal (NCLT) over the company's $200 million rights issue, in a petition alleging oppression and mismanagement. 

The investors — Prosus, General Atlantic, Sofina, and Peak XV (formerly Sequoia) — had sought a stay on the rights issue at less than 99 per cent of the enterprise valuation compared to Byju's peak valuation of $22 billion, fearing it would devalue their investment.