Peak XV informs LPs of plans to markdown BYJU'S investment: Report

Peak XV Partners (formerly Sequoia Capital India) has reportedly informed its limited partners (LPs) about its plans to mark down the value of its holding in edtech firm BYJU'S.

The Economic Times has reported that the decision was attributed to the fund's concerns over the lack of visibility into BYJU’S up-to-date audited financials and its limited ability to influence corrective measures.

The fund will substantially write down its investment in BYJU'S during the upcoming reporting cycle, it added.

According to the report, GV Ravishankar, Managing Director at Peak XV Partners, resigned from BYJU’S board due to the fund's dissatisfaction with the company's management, concerning internal processes, governance, and audit matters.

YourStory has reached out to Peak XV for a comment.

The report comes a day after Prosus, another key investor in BYJU'S, said that despite repeated efforts from its Director, executive leadership at BYJU’S regularly disregarded advice and recommendations relating to strategic, operational, legal, and corporate governance matters.

“The decision for our Director to step down from the BYJU’S Board was taken after it became clear that he was unable to fulfil his fiduciary duty to serve the long-term interests of the company and its stakeholders,” Prosus stated.

The investor released the statement a month after its representative, Russell Dreisenstock, officially resigned from the edtech firm's board. Alongside Dreisenstock and Ravishankar, Vivian Wu from the Chan Zuckerberg Initiative also stepped down from BYJU’S board.

"We have noted the observations of our valued investors. We have updated our shareholders about definitive steps taken to improve corporate governance and financial reporting," a BYJU'S spokesperson said after Prosus issued its statement.

Last month, Amsterdam-headquartered Prosus, in its annual report, pared its effective interest in BYJU'S down to 9.6%, down from 9.81% in FY22, owing to the resignation of Dreisenstock from the company’s board. It has also slashed the valuation of the edtech company to $5.1 billion, per media reports.

BlackRock, the world's largest asset management company, has marked down its stake in BYJU'S by 62% as of March 31, 2023, resulting in the edtech company being valued at approximately $8.4 billion, a significant decline from its previous funding valuation of $22 billion.

Meanwhile, BYJU’S grapples with other issues, such as delays in filing financial statements and facing an inspection of its account books following a government order.

Last month, the company said it is targeting the end of September to publish its FY22 audit and expects the FY23 audit to conclude by the end of December. In FY21, the edtech giant reported a loss of Rs 4,564.38 crore, significantly larger than its FY20 loss of Rs 305.5 crore.