New Delhi:

Byju’s is laying off about 500 employees, including from sales, amid a financial crunch, sources said, even as the troubled edtech firm maintained that it is in the final stages of business restructuring to streamline operations.

The layoff in the embattled edtech company began 15-20 days ago, sources said, adding that it would impact 500 employees.

They, however, pointed out that the edtech player might not have to resort to further rationalisation, except in the ‘worst case scenario’.

The latest round of job cuts will impact sales functions, teachers and some tuition centres.

There was no official word from Byju’s, which has been embroiled in a legal dispute with some of its investors, with regard to the layoffs.

Few staff members were purportedly communicated about the development over the phone.

When contacted, Byju’s spokesperson, in an email response, said, “We are in the final stages of a business restructuring exercise announced in October 2023 to simplify operating structures, reduce the cost base, and better cash flow management”.

“As you are also aware, we are going through an extraordinary situation in the company because of the ongoing litigation with four foreign investors, where every employee and the ecosystem is going through tremendous stress, given the present circumstances,” the spokesperson said.

Byju’s said that it regrets the “unfortunate situation” the company has been forced into.

“Still, it is something that we will put behind us soon with majority investor support for the USD 200 million rights issue. We request everyone’s understanding of the individual and collective stress on the system, which might be prompting some unforeseen situations for the departing employees,” Byju’s spokesperson said.

Byju’s had earlier indicated that the business rehaul exercise would impact nearly 4,500 people, and subsequently in October and November of 2023, as many as 2,500-3,000 people were laid off.

Considering that nearly 3,000-3,500 people have been affected by layoffs so far, it still leaves the possibility for further retrenchment of 1,000-1,500 people.

Byju’s recently informed its employees that there will be a delay in the disbursement of March salaries.

The management in a communication to employees had blamed the situation on an interim order obtained by “a few misguided foreign investors” in late February, which “restricted usage of the funds raised through the successful rights issue”.

Byju’s had also sought to assure staff that it is following a parallel line of credit to ensure that employees get their salaries by April 8.

A clutch of investors of Byju’s had filed an oppression and mismanagement suit against the company management before the National Company Law Tribunal (NCLT), seeking to oust the founders, including CEO Byju Raveendran, and appoint a new board.

Earlier, the National Company Law Tribunal (NCLT), Bengaluru Bench declined to grant a stay on the extraordinary general meeting (EGM) called by ‘Think and Learn’, owner of the Byju’s brand, on March 29. The EGM was called to hike the authorised share capital of the embattled edtech firm, following the recent USD 200 million rights issue.

The company had closed the USD 200 million rights issue in February at a 99 per cent lower valuation compared to its peak enterprise value of USD 22 billion.

The once-storied edtech startup, Byju’s rose to dizzying heights before facing a slew of challenges.

While the return of students to physical classes post-pandemic and the recent acquisition of Aakash put Byju’s under a financial strain, the edtech firm in the last one year suffered other setbacks too, including its auditor resigning, lenders beginning bankruptcy proceedings against a holding company and a US lawsuit disputing the terms and repayment of a loan.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

New Delhi:

Embattled edtech company Byju’s has informed its employees that there will “again” be a delay in disbursement of salaries.

Byju’s management in a communication to employees blamed the situation on an interim order obtained by “a few misguided foreign investors” in late February which “restricted usage of the funds raised through the successful rights issue”.

Byju’s also sought to assure staff that it is following a parallel line of credit to ensure that employees get their salaries by April 8.

“We are writing to you today with a heavy heart but with a message of hope and reassurance. We regret to inform you that there will again be a delay in the disbursement of salaries. A few misguided foreign investors in BYJU’S have obtained an interim order in late February which has restricted usage of the funds raised through the successful rights issue,” the management wrote.

The note further said: “This irresponsible action by the four foreign investors has compelled us to temporarily hold the disbursal of salaries until the restriction is lifted.” Byju’s said it has full faith in the Indian judicial system and eagerly awaits a favourable outcome that will enable it to utilise the funds raised through the rights issue and alleviate the financial challenges it is currently facing.

“As you know, the founders have put everything back into the company, and regardless of the court verdict, we are following a parallel line of credit to ensure that you receive your salary by 8th of April,” the management said.

On a positive note, the management said, it has the necessary vote to increase the authorised capital for the rights issue.

“It means that once the restrictions on using the raised funds are lifted, we can meet all our salary commitments immediately. As you might have read, our founder, Byju Raveendran, has once again appealed to disgruntled investors in a collaborative spirit, and we are hoping that litigating investors would have a reasonable spirit in not frustrating our daily lives any longer,” it said.

The company said it understood the feelings of helplessness that may arise due to these circumstances, and added “we share your frustration”.

“However, we urge you to hold onto hope and remain resilient. BYJU’S has overcome challenges recently, and we firmly believe that together, we will overcome this last hurdle. We are confident that justice will prevail and the financial constraints will be resolved soon,” the management wrote thanking employees for their patience, understanding, and continued dedication during the difficult time.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)