BYJU'S delays settlements of 1,000 laid-off employees to November
What's the story
BYJU'S, the world's most valuable edtech company, has postponed the full and final settlements of nearly 1,000 laid-off workers from September to November as it faces a liquidity crunch.
The delay comes amid ongoing lender commitments and a long-pending fundraise.
The company embarked on a significant workforce reduction in June, impacting various departments in a strategic move toward profitability.
Insights
Here's what BYJU'S said to employees
In June, BYJU'S laid off employees across mentoring, training, logistics, sales, post-sales, and finance departments.
At that time, the employees were told they would receive the pay for June and July as part of final settlements, besides extra incentives, by September 15.
However, on Thursday (September 14), the firm notified them via email that there would be a delay, and now the workers could expect to receive their dues by November 17.
What Next?
BYJU'S selling assets to secure loan repayment funds
As part of its goal to secure the necessary funds for repaying loans, BYJU'S has even put up the book reading platform Epic and upskilling site Great Learning for sale.
This would yield the parent company around $1 billion.
BYJU'S is also negotiating with US-based asset management company Davidson Kempner. It lent BYJU'S $250 million back in May via structured debt based on the future cash flows of Aakash Educational Services, BYJU's largest asset.
Details
Edtech giant plans $1.2 billion loan repayment
The payment delay comes at a time when the edtech giant is working on ending a long-pending funding round and repaying its $1.2 billion term loan B within the next six months.
BYJU'S submitted a proposal to its lenders recently, expressing its plans to fully repay the loan within this timeframe.
The company plans to make an initial payment of $300 million within the coming three months and is also undertaking a strategic review of its key assets.