According to Bloomberg, a court-appointed agent has declared bankruptcy on behalf of the US branch of the Indian edtech company Byju’s.
The action was taken in response to Byju’s Alpha unit’s debt default of US $1.2 billion. The CEO of the US company, Timothy Pohl, filed a document that the Bloomberg report cited, stating that Byju’s Alpha did not have the money to pursue its debt dispute with its parent company.
Byju’s Alpha is also preparing to sue a small hedge fund with headquarters in Florida, claiming the fund assisted Byju in hiding more than $500 million in cash that ought to have been given to its creditors.
Byju’s Alpha listed at least $500 million in assets and at least $1 billion in liabilities in its bankruptcy filing.
In the meantime, several Byju’s principal supporters have demanded a reorganization of the board of directors in addition to a shift in the company’s leadership.
In order to “support its ongoing efforts to drive growth and achieve operational sustainability,” Think and Learn, the parent company of Byju, previously stated that it is seeking to raise $200 million through a rights issue.
