New Delhi: In a dramatic turn of events, edtech giant Byju’s has secured a major reprieve. The National Company Law Appellate Tribunal (NCLAT) on Friday approved the company’s proposed settlement of Rs 158.9 crore with the Board of Control for Cricket in India (BCCI), effectively staving off insolvency proceedings.
The decision marks a significant victory for Byju Raveendran and his team, who have been under immense pressure due to the company’s financial woes. The NCLAT’s order effectively restores Byju Raveendran’s control over the firm.
Settlement Terms and Conditions
To reach a settlement, Byju’s has committed to paying the entire amount to BCCI in installments. A substantial sum of Rs 50 crore was paid on July 31, 2024, with another Rs 25 crore deposited on Friday itself. The remaining Rs 83 crore is scheduled for payment on August 9.
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The NCLAT has imposed a strict caveat: any default in these payments will automatically trigger the revival of insolvency proceedings against Byju’s.
Allegations and Counterclaims
The road to this settlement was fraught with accusations and counterclaims. Byju’s faced allegations of financial mismanagement and missed revenue targets, leading to a significant devaluation of the company. The US-based lenders even accused the company of round-tripping funds, a claim that the NCLAT dismissed due to lack of evidence.
BCCI, on the other hand, was owed a substantial amount in sponsorship fees. The cricket board had initiated insolvency proceedings against Byju’s after the edtech company defaulted on the payments.
A Second Chance for Byju’s
The NCLAT’s decision offers Byju’s a lifeline. However, the company still faces numerous challenges, including investor concerns and the need to regain market trust. Byju Raveendran expressed gratitude to the team for their unwavering support and reiterated the company’s commitment to providing quality education.
This development is being closely watched by the industry and the public, as it could set a precedent for how such high-profile corporate disputes are resolved.
