Indian edtech startup Byju’s is currently engaged in advanced discussions with potential new investors to secure $1 billion in funding, Bloomberg News report said.
This move comes as Byju’s aims to navigate a conflict with certain existing investors. Last week, board members representing three global investors — Peak XV, Prosus NV, and the Chan-Zuckerberg Initiative — and auditor Deloitte resigned from their positions.
While the departing board members did not provide a specific reason for their decision, Deloitte stated that it was severing ties with Byju’s due to delays in disclosing certain financial statements. Additionally, the company faced a raid related to suspected violations of foreign exchange laws.
To entice potential investors, Byju’s is reportedly offering them benefits such as preferential treatment in case of liquidation, an option that is not available to current shareholders.
The report does not clarify whether Byju’s founder, Byju Raveendran, will ultimately succeed in securing the desired capital infusion. A portion of the funds raised is expected to be allocated towards resolving a contentious $1.2 billion term loan. Byju’s and its lenders are currently embroiled in legal disputes in the United States concerning the loan’s restructuring.
Byju’s, which was valued at $22 billion last year, has made a plea to its investors to reconsider their decision to resign from the board. Byju Raveendran, the founder and CEO, intends to reconstitute the company’s board after the completion of the fundraising process, as new investors may fill some of the vacant positions.
