BYJU’S proposes accelerated $1.2B loan repayment plan to lenders: Report

Edtech firm BYJU'S has reportedly proposed an accelerated repayment plan to its lenders, offering to fully repay its $1.2 billion term loan B (TLB) within a period of six months.

The Bengaluru company has put forward a repayment plan, suggesting it pays off $300 million of the TLB within the first three months, followed by clearing the remaining amount over the next three months, according to a Bloomberg report.

The report added that the TLB lenders are currently evaluating the proposal and are requesting further clarification on the funding source for the repayment. It remains uncertain whether an agreement will be reached between the parties.

YourStory could not independently verify the report and has reached out to BYJU’S and a representative of the committee of ad hoc term loan lenders for comments.

For nearly a year, both parties have been embroiled in a conflict, with multiple rounds of negotiations to amend the TLB agreement.

BYJU’S and its lenders were expected to finalise a term loan amendment before August 3, 2023.

In July, the steering committee of ad hoc term loan lenders, who collectively own more than 85% of BYJU'S $1.2 billion TLB, had said in a statement that the successful execution of the amendment would immediately solve the loan’s acceleration and end all open litigation while avoiding further enforcement actions.

BYJU'S and the lenders have been involved in litigation against each other in the United States courts. In June, a consortium of ad hoc lenders termed BYJU'S lawsuit against them as "meritless" after the company challenged the acceleration of the loan at the New York Supreme Court. 

BYJU’S Alpha, a wholly-owned subsidiary of the edtech unicorn, raised the loan in November 2021.

According to the Bloomberg report, the loan is currently valued at 49.8 cents on the dollar, which is typically considered a distressed level, especially when it falls below 70 cents.