BYJU'S awaits full disbursement of $250M debt funding from Davidson Kempner: Report

Edtech major BYJU'S is reportedly awaiting the full disbursement of $250 million debt funding from Davidson Kempner Capital due to the failure to meet the terms set by the New York-based asset management company.

Last month, the Bengaluru-based firm had reportedly raised $250 million at a flat valuation of $22 billion through structured instruments from investment firm Davidson Kempner. 

The Economic Times has reported that due to the unexpected lack of progress in discussions with lenders, Davidson Kempner has decided to hold back the complete transfer of funds. BYJU’S and the lenders have resumed negotiations and have reached a mutual agreement to seek a resolution by August, the report added.

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YourStory could not independently verify the report and has reached out to BYJU’S and Davidson Kempner for comments. 

The edtech company has encountered a series of hurdles, including the departure of Deloitte as its auditor, the resignation of three prominent board members, conflict with creditors over a $1.2-billion term loan B (TLB), and delays in filing financial statements, among other issues.

The ongoing challenges faced by BYJU’S with its TLB lenders, coupled with the delay in filing its financial statements for FY22, have resulted in the delay of the full disbursement of $250 million, The Economic Times report noted.

The New York-based asset management company has set a condition precedent for the loan, which is contingent upon the submission of its financial accounts, the report added.

Earlier this week, YourStory reported that BYJU'S is targeting a September deadline to close its FY22 audit and conclude the FY23 audit by December. The company is also considering appointing independent directors to its board.

Last Friday, Peak XV Partners' GV Ravishankar, Prosus's Russell Dreisenstock, and Chan Zuckerberg Initiative's Vivian Wu—three key board members of BYJU'S—officially resigned from the board of the edtech firm.

The edtech unicorn has been plagued with mounting losses, layoffs, and pending loans after the end of the pandemic-led edtech boom.