Adding that every legal roadblock has lengthened the company’s path to recovery, he said that the ed-tech firm is on the verge of reversing the negative business cycle.
Byju’s CEO explains why the company is unable to pay July salary
“I want to address the matter of utmost concern to you – and to me as well. Your salary for July 2024 has not been credited yet. Our company recently faced a serious challenge that pushed us into insolvency due to a dispute with the BCCI. We settled the case and were on the brink of regaining control of our finances after the NCLAT ruled in our favour.”
“The apex court has issued a temporary stay on the NCLAT’s decision, which means the control of the company’s accounts has not yet been restored to us,” Raveendran said.
In the letter, Raveendran said “Founders are unable to infuse more capital to pay salaries like we have always done over the past many months. I guarantee this: When we regain control, your salaries will be paid promptly, even if that means raising more personal debt. This isn’t just a promise – it’s a commitment. We have investors ready to back our turnaround story,” Raveendran said.
“I am not a fugitive”: Raveendran
Raveendran refuted the allegation of Byju’s founders being “fugitives” as he has travelled to India 10 times since March 2023 and spent 77 days in total. “I am not a fugitive,” he said, emphasizing that his travels are for business and family reasons.
“Founders together have infused approximately Rs 7,500 crore in the company for various operational needs. As a matter of fact, out of the Rs 3,976 crore disbursed as salaries to the team over the past two years, Rs 1,600 crore was infused by Riju personally.
“When was the last time you saw founders using their savings, even borrowings, to pay salaries for their beloved team members for more than two years?” Raveendran said.
“ED has not commenced any investigation against Riju or me in any personal capacity either,” he said.
SC set aside insolvency proceedings against Byju’s
For those unaware, the National Company Law Appellate Tribunal (NCLAT) on August 2 approved the Rs 158.9 crore dues settlement with Board of Control for Cricket in India (BCCI) and set aside insolvency proceedings against Byju’s. Days later, the Supreme Court on August 14 stayed the verdict of the insolvency appellate tribunal against the ed-tech major based on a plea of US-based creditor Glas Trust Company LLC.
While foreign lenders allege that Byju’s has used the money it raised from them in the US in violation of the contract, Byju’s had contested the claim. The company says that the fund raised through Term Loan B (TLB) in the US was not used for BCCI settlement.
“My brother, Riju, has taken full financial responsibility for settling Rs 158 crore with the BCCI. The funds used to discharge this obligation were sourced entirely from his finances, which were accumulated through the sale of his shares in Byju’s between May 2015 and January 2022. These sales have been thoroughly documented, and the relevant income taxes have been paid as the law requires,” Raveendran said in the letter.
He said the BCCI settlement was completed in full compliance with all legal requirements. “We have submitted it under oath to the court. It clearly states that of the Rs 3,600 crore he earned from secondary share sales, approximately Rs 2,600 crore were reinvested into Byju’s to sustain the company’s operations, and Rs 1,050 crore were paid as income tax,” Raveendran noted.