US Court Prohibits BYJU’S from Transferring $533 Million Loan Proceeds

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News Update

  • By     |    March 16, 2024
US Court Prohibits BYJU’S from Transferring $533 Million Loan Proceeds

In the latest development concerning the BYJU’S controversy, a US court has issued a prohibition on further transfer or use of the $533 million in loan proceeds. Judge John T. Dorsey of the US Bankruptcy Court for the District of Delaware granted a preliminary injunction, alongside ordering the arrest of William Morton, Founder of Camshaft Capital Fund, LP. The court found BYJU’S Founder Byju Raveendran and Co-founder Divya Gokulnath collaborating with the defendants and mandated their compliance with the ruling. According to a statement by the steering committee of the ad hoc group of term loan lenders of BYJU’S $1.2 billion term loan B (TLB), “I’m still very upset about the fact that [the Defendants] are obfuscating where this money is,” Judge Dorsey stated.

In 2021, BYJU’s Alpha, Inc., a US subsidiary of BYJU’S, received funds from the $1.2 billion TLB. Under Ravindran’s control in 2022, BYJU’S Alpha transferred $533 million of the loan proceeds to Camshaft Capital Fund, LP, established by Morton. The court issued an arrest order for Morton after he failed to appear and furnish requested information regarding the transfer and present status of the funds, with a daily fine of $10,000 until compliance. “This ruling confirms that Byju Raveendran himself is acting in concert with… his brother, Riju, his wife, Divya, and fugitive William Morton,” said the SteerCo, emphasizing the importance of freezing assets towards recovering the missing $533 million.

The ongoing TLB dispute, involving the $533 million, represents one of many challenges facing the edtech company. In January, lenders of BYJU’S lodged an insolvency petition against the firm with the National Company Law Tribunal (NCLT). In India, the company is entangled in a dispute with its shareholders, with resolutions passed during an extraordinary general meeting (EGM) in February, subsequently stayed by the Karnataka High Court. Additionally, a group of four investors filed a lawsuit accusing the company’s management of oppression and mismanagement before the Bengaluru bench of the NCLT.

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US Court Prohibits BYJU’S from Transferring $533 Million Loan Proceeds


News Update

  • By     |    March 16, 2024
US Court Prohibits BYJU’S from Transferring $533 Million Loan Proceeds

In the latest development concerning the BYJU’S controversy, a US court has issued a prohibition on further transfer or use of the $533 million in loan proceeds. Judge John T. Dorsey of the US Bankruptcy Court for the District of Delaware granted a preliminary injunction, alongside ordering the arrest of William Morton, Founder of Camshaft Capital Fund, LP. The court found BYJU’S Founder Byju Raveendran and Co-founder Divya Gokulnath collaborating with the defendants and mandated their compliance with the ruling. According to a statement by the steering committee of the ad hoc group of term loan lenders of BYJU’S $1.2 billion term loan B (TLB), “I’m still very upset about the fact that [the Defendants] are obfuscating where this money is,” Judge Dorsey stated.

In 2021, BYJU’s Alpha, Inc., a US subsidiary of BYJU’S, received funds from the $1.2 billion TLB. Under Ravindran’s control in 2022, BYJU’S Alpha transferred $533 million of the loan proceeds to Camshaft Capital Fund, LP, established by Morton. The court issued an arrest order for Morton after he failed to appear and furnish requested information regarding the transfer and present status of the funds, with a daily fine of $10,000 until compliance. “This ruling confirms that Byju Raveendran himself is acting in concert with… his brother, Riju, his wife, Divya, and fugitive William Morton,” said the SteerCo, emphasizing the importance of freezing assets towards recovering the missing $533 million.

The ongoing TLB dispute, involving the $533 million, represents one of many challenges facing the edtech company. In January, lenders of BYJU’S lodged an insolvency petition against the firm with the National Company Law Tribunal (NCLT). In India, the company is entangled in a dispute with its shareholders, with resolutions passed during an extraordinary general meeting (EGM) in February, subsequently stayed by the Karnataka High Court. Additionally, a group of four investors filed a lawsuit accusing the company’s management of oppression and mismanagement before the Bengaluru bench of the NCLT.

Follow Startup Story





Source link

Disclaimer

We strive to uphold the highest ethical standards in all of our reporting and coverage. We StartupNews.fyi want to be transparent with our readers about any potential conflicts of interest that may arise in our work. It’s possible that some of the investors we feature may have connections to other businesses, including competitors or companies we write about. However, we want to assure our readers that this will not have any impact on the integrity or impartiality of our reporting. We are committed to delivering accurate, unbiased news and information to our audience, and we will continue to uphold our ethics and principles in all of our work. Thank you for your trust and support.

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