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Cash-strapped Byju's distributes part of salaries to employees: Report
Last week, Byju Raveendran in a letter to employees had said that the company will not be able to pay them salaries.
Cash-strapped edtech platform BYJU's has announced that it disbursed parts of pending salaries to all the employees for the month of February, promising to clear the balance once it is allowed to use the funds from the closed rights issue, Moneycontrol reported.
In a letter to employees as seen by the website, BYJU's said it has processed part of salaries for February on Friday night to the extent of capital it had outside the rights issue. According to the report, the company expects the salaries to be reflected in the accounts of employees on March 11 as it was delayed due to a second Saturday and a long weekend.
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The company also said that it has made alternate fund arrangements to ensure that the daily lives are not disrupted. The edtech platform added that is “committed to serve the students with passion and dedication they deserve”.
Last week, the company's chief executive Byju Raveendran in a letter to employees had said that the company will not be able to pay them salaries because it cannot access recently raised funds due to a legal dispute with some of its investors.
“Unfortunately, a select few (4 out of our 150 plus investors) have stooped to a heartless level, ensuring that we are unable to utilise the funds raised to pay your hard-earned salaries,” Raveendran's letter to employees read.
Last month, the investors had alleged that BYJU's had siphoned off $533 million in an obscure hedge fund in the United States and sought a stay on a $200 million rights issue, calling it illegal. However, the company had rejected the allegations.
Byju's has suffered setbacks since early 2023, including its auditor resigning, lenders beginning bankruptcy proceedings against a Byju's holding company, and a U.S. lawsuit disputing the terms and repayment of a loan. The company was once one of India's hottest startups and valued at $22 billion in 2022.
