Byju's, India's most-valued startup, has offered to repay the entire $1.2 billion term loan B (TLB) to its lenders in under six months, in a surprise move that will bring some cheer to the edtech giant.
The company has proposed repaying $300 million of the $1.2 billion loan in the next three months, contingent on lenders accepting its amendment proposal, a person with direct knowledge of the matter told Moneycontrol. The lenders are evaluating the proposed amendment and have requested additional information regarding the repayment, the person added.
Bloomberg first reported the development.
"The company has charted out a very aggressive plan of repayment and is fairly confident of paying back the loan," the person said, requesting anonymity.
Byju's and lenders did not immediately respond to queries sent by Moneycontrol.
In November 2021, Byju's raised $1.2 billion in debt through a term loan facility (TLB) from a group of overseas investors. A TLB is a type of senior secured syndicated credit facility that is issued by global institutional investors. Typically, the proceeds from a TLB are used to either refinance an existing debt or to make overseas acquisitions in order to enhance a company's offerings.
Earlier in June this year, Byju's sued the lenders in the New York Supreme Court, challenging the acceleration of the TLB. It also skipped paying $40 million in interest that was due post the acceleration. Since then, the two parties have had multiple calls to reach an amendment.
In July, the lenders sent out a statement saying they would rework terms on the $1.2-billion loan by August 3 with the company. However, the two parties failed to arrive at a conclusion.
Byju's, one of the world's largest edtech firms, last valued at about $22 billion, has been looking to raise funds since the start of the year. However, the company has not managed to close the round amid ongoing challenges on various domestic and international fronts.
In May, it raised $250 million in structured instruments from Davidson Kempner, but the US-based AMC held back close to $150 million as the company’s talks with its lenders did not progress well.
Byju's also had a technical default on the Davidson Kempner loan. This prompted Byju Raveendran to raise funds to repay it, in order to avoid losing control of his most valuable asset, Aakash Educational Services. Byju's had offered Aakash's shares as collateral for the Davidson Kempner loan.
Byju’s is also exploring fundraising from one of its earliest backers, Ranjan Pai, for Aakash Educational Services. Pai is expected to buy out a part of Raveendran’s stake in Aakash, Moneycontrol reported last month. Raveendran holds close to 30 percent stake in Aakash.
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