Qatar Investment Authority (QIA) which invested in India’s former edtech unicorn Byju’s in 2019 is now taking legal action against the company amid insolvency. The sovereign wealth fund of Qatar has petitioned the Karnataka High Court to prevent the founder Byju Raveendran from selling, pledging, or transferring his assets, seeking to safeguard its investment in the company.
This move comes as the Bengaluru-based edtech company faces financial difficulties, including delays in reporting and disputes with investors, prompting the Qatar Investment Authority to seek a court order to freeze Raveendran’s assets.
One of the largest foreign investors in India, Qatar Investment Authority (QIA), has requested the court to “pass an order of injunction restraining Respondent No. 1 (Byju Raveendran), including his servants, agents, and assigns, from in any manner dealing with, parting with, selling, charging, pledging, transferring, disposing of, alienating, or encumbering, or in any manner creating any right, title, or interest in any of their assets,” As reported by Mint newspaper, based on court records.
QIA has filed a petition seeking to claim Byju Raveendran’s personal assets, valued at approximately $235.19 million, under Section 9 of the Arbitration and Conciliation Act, 1996. The respondents named in the petition are Raveendran himself and Byju’s Investments, a company controlled by Raveendran and his family members.
Despite securing a $250 million investment from existing investors, including QIA, in October 2022 at a valuation of $22 billion, Byju’s is facing a multitude of challenges. These include a severe cash shortage, delayed financial reporting, and ongoing legal disputes with lenders and investors. Additionally, seven vendors have petitioned the National Company Law Tribunal (NCLT) to recover outstanding payments, further exacerbating the company’s financial difficulties.
Byju’s is embroiled in a legal dispute with investors Prosus, General Atlantic, Sofina, and Peak XV (formerly Sequoia) at the (NCLT). The investors are seeking a stay on the company’s $200 million rights issue, alleging oppression and mismanagement. They are challenging the valuation, which is reportedly less than 99 percent of Byju’s peak valuation of $22 billion.
In a significant development, US-based lenders took Byju’s to court earlier this year, filing for corporate insolvency at the NCLT’s Bengaluru Bench. The lenders, who provided a substantial $1.2 billion in term loans, revealed that GLAS Trust Company LLC had lodged a petition against Think & Learn, the parent entity of the edtech giant Byju’s.
The National Company Law Tribunal (NCLT) has admitted Byju’s (officially known as Think and Learn Pvt Ltd) into the Corporate Insolvency Resolution Process, following a petition filed by the Board of Control for Cricket in India (BCCI) over unpaid dues of Rs 158.90 crore. Byju’s has subsequently appealed against the NCLT’s order at the National Company Law Appellate Tribunal (NCLAT).
In a separate development, Byju’s also partnered with QIA in 2022 to launch a new edtech business and R&D center in Doha, aimed at driving innovation and creating customized learning solutions for students in the Middle East and North Africa.
