Edtech Startup Byju’s Says Restructuring Businesses
Embattled edtech startup Byju’s and its lenders have restarted talks to restructure the company’s $1.2 billion term loan, people familiar with the matter said. The lender has delivered a detailed amendment proposal that calls for debt pay down, coupon boost and better investor protections, the people added.
This comes after three key investors — Peak XV Partners, Prosus NV and Chan Zuckerberg Initiative — and auditor Deloitte Haskins and Sells resigned from the board.
MUMBAI: Three senior executives are leaving India’s most valuable edtech startup as it revamps its businesses and tries to regain its footing. Prathyusha Agarwal, chief business officer, Himanshu Bajaj, head of Byju’s Tuition Centers and Mukut Deepak, the company’s business head for class 4 to 10 have quit, sources said.
The departure comes at a time when the company is trying to get itself back on track after several setbacks including audit firm Deloitte’s resignation and legal tussles with creditors. The edtech unicorn has also terminated thousands of employees to cut costs.
Meanwhile, Byju’s and some of its lenders have restarted negotiations to restructure the company’s $1.2 billion loan after the Indian education-technology firm breached certain terms of the debt agreement, people familiar with the matter said.
The parties want to avoid a messy legal brawl over the issue and seek an out-of-court solution, the people said. Lenders have hired restructuring advocate Houlihan Lokey Inc to assist in the talks. Byju’s and the lenders are expected to finalise a deal by June 5, they added.
Edtech startup Byju’s is dealing with a series of setbacks as its efforts to regain stability hit a bump. The company is reported to have lost three leadership employees, including the Chief Business Officer, as it consolidates its various businesses into two key verticals – K-10 and Exam Prep.
Prathyusha Agarwal and Himanshu Bajaj have stepped down, while Mukut Deepak has resigned from his role as the Business Head for Class 4 to 10.
Agarwal joined Byju’s in February 2022 from Zee Entertainment Enterprises where she was the Chief Consumer and Data Officer. She has over a decade of experience in the consumer sector. She was one of the first few leaders to join Byju’s and help lead its growth strategy, marketing and sales.
Meanwhile, Bajaj has been the Business Head of Byju’s Tuition Centers since November 2021. He previously worked with Tata Play and management consulting firm AT Kearney.
The exits come after US-based asset management firm Baron Capital slashed Byju’s valuation in June. The firm cut the Bengaluru-based company’s unicorn valuation by almost 44 per cent to $12 billion from $22 billion. The decline is largely due to Covid-19-related tailwinds that have begun to dissipate. Byju’s is also facing challenges in its efforts to secure debt financing and the backing of investors.
Prathyusha Agarwal, a former chief consumer and data officer at ZEE Entertainment Enterprises Ltd, has joined online-education firm Byju?s in a leadership role to lead its Early Learn Business vertical in India.
She will chart the portfolio strategy, define and deliver the holistic learning consumer offering and drive top-line growth in the segment.
Mukut Deepak, who led the classes 4-10 business; Himanshu Bajaj, head of tuition centers; and Agarwal resigned as part of the edtech unicorn?s consolidation of four businesses into two K-10 and exam preparation. An spokesperson for the company attributed these exits to organizational restructuring.
The most-valued Indian startup and some of its lenders have restarted talks to restructure the $1.2 billion term loan that Byju?s took last year, people familiar with the matter said.
The parties are trying to avoid a legal brawl and work out a more lenient debt agreement, the people said, asking not to be identified because the information is private.
The edtech giant said it will continue to invest in new products, platforms and experiences, while also rationalising its product, content, media and technology teams.
Around 5% of the 50,000-strong workforce will be affected by this restructuring. Besides this, the company will restructure its subsidiaries such as Toppr, Meritnation, TutorVista and Hash-Learn to “avoid redundancies in roles”. It will also integrate the business of Great Learning into its main operations, it added.