Byju’s, India’s top-valued startup, is preparing to pay about $40 million (₹330.42 crore) in quarterly interest on a $1.2 billion (₹9,913 crore) loan, according to a media report. The news comes as the education technology firm grapples with financial challenges.
What Happened? Per an Economic Times report, the company aims to make the payment on Monday, thus meeting the June 5 deadline and avoiding a loan default.
This $1.2 billion (₹9,913 crore) debt is the largest unrated loan ever taken by a startup. Byju’s, once a rapidly growing company led by ex-teacher Byju Raveendran, has been in discussions with creditors to restructure this loan following financial hardships spurred by a downturn in the online tutoring sector post-pandemic.
Creditors, however, called for faster repayment, ending prolonged negotiations. A group of lenders agreed to a cooperation deal, which requires them to negotiate jointly.
See also: Lenders Accuse Byju’s Of Hiding $500M, Seek Control Over Edtech Giant
The loan’s value plunged to a record low of 64.5 cents per dollar in September, but Bloomberg’s data now quotes it at around 78 cents.
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Byju’s making the interest payment on time could provide it with enough flexibility to await a significant capital influx that it plans to use to repay the loan. The company has made all previous debt payments on schedule.
Despite missing the deadline to submit financial accounts for the year ending March 31, and facing an investigation by India’s foreign exchange policies violation agency, Byju’s continues to strive to stabilise its financial situation.
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