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In a fresh legal development, Byju Raveendran, the founder of the embattled ed-tech giant Byju’s, has been accused of attempting to secretly regain control of the company using hidden loan funds. According to a recent Bloomberg report, Raveendran allegedly hid millions of dollars of loan proceeds to purchase back a software company that had been taken over by an American trustee.
The report, based on newly filed court documents, suggests that the money was funneled through OCI Ltd, a logistics firm based in the UK, despite claims by Raveendran that all loan money had been spent. The loan funds, reportedly amounting to millions of dollars, were supposedly concealed from the US creditors to whom Byju’s owes over $1.2 billion.
In what appears to be an effort to clear his financial obligations, Raveendran allegedly enlisted Nebraska businessman William R. Hailer to assist in buying out the US creditors. Hailer, a former political consultant, ran Rose Lake Inc, a company that reportedly received $11.25 million from Raveendran to create the illusion of adequate funding. The plan, as detailed in the court filings, was for the money to eventually be returned to Raveendran after it had been used to reassure the creditors.
These revelations add to a growing list of legal challenges faced by Byju’s. The company is currently embroiled in a complex battle with creditors in both the US and India. US lenders have been pursuing Byju’s in state and federal courts, alleging that Raveendran concealed $533 million of loan proceeds that should have been used to repay the debt. In India, the company is dealing with an insolvency proceeding, with a court-appointed professional tasked with raising funds to pay off its creditors.
Despite these accusations, Raveendran has consistently denied any wrongdoing. He has defended his actions, claiming that they were a necessary response to what he described as aggressive tactics employed by creditors seeking to exploit distressed companies.
As the legal battles intensify, Byju’s is facing mounting pressure, both in India and internationally, as it struggles to address its financial woes and restore its reputation. The outcome of these proceedings could significantly impact the future of the company, which has already faced layoffs, financial instability, and growing scrutiny in recent months.
Sources By Agencies
