Indian education technology firm Byju’s has revealed plans to implement significant restructuring measures, including a workforce reduction of approximately 5,500 jobs, aimed at curbing costs, as reported by the Economic Times on Tuesday.
Arjun Mohan, the newly appointed Chief Executive Officer of Byju’s India business, is set to oversee the amalgamation of various business verticals as part of these impending changes. These restructuring efforts are expected to be rolled out later this week or in the early part of the following week.
The job cuts will primarily be executed at Byju’s parent company, Think & Learn, and will not affect any of its subsidiaries, according to the report. A substantial portion of the roles to be eliminated will encompass senior positions within the organization.
The move is geared towards intensifying efforts to attract more students to offline centers, establishing this as a key strategy for the new management to ensure sustainable operations over an extended period. The company, which was valued at $22 billion last year, has been encountering a series of challenges, including resignations by its auditor and board members. Moreover, recent months have seen the company navigating negotiations for the repayment of a substantial $1.2 billion loan.
This strategic restructuring aims to streamline operating structures, reduce the cost base, and enhance cash flow management, aligning with Byju’s broader business restructuring in light of a delayed IPO and pressures from lenders. The company is navigating this change under the leadership of its new CEO, Arjun Mohan.
A Byju’s spokesperson stated, “We are in the final stages of a business restructuring exercise to simplify operating structures, reduce the cost base and better cash flow management.” They further added, “Byju’s new India CEO, Arjun Mohan, will be completing this process in the next few weeks and will steer a revamped and sustainable operation ahead.”
Last week, Byju’s appointed Arjun Mohan as the CEO of its India operations, succeeding Mrinal Mohit, the outgoing head of India business. This shift in leadership comes as Byju’s contemplates selling certain subsidiaries, including Epic and Great Learning, to raise funds for repaying its outstanding $1.2 billion Term Loan B (TLB) amid a challenging business restructuring phase.
Byju’s is exploring options to sell these subsidiaries to generate between $800 million and $1 billion. Reports suggest that the company has devised a proposal to repay $300 million of the debt within three months, with the remaining amount to be repaid over the subsequent three months. Lenders are currently reviewing this proposal.
Byju’s, a prominent player in the education technology sector, is enacting these strategic changes to adapt and enhance its operations amidst a challenging business landscape.