Byju's disburses part of pending salaries for employees; promises to pay the balance from rights issue fund
This comes as the National Company Law Tribunal (NCLT) in its order passed on February 27 directed the edtech company to keep funds received from the rights issue in an escrow account till the disposal of the oppression and mismanagement plea filed by four of the company's investors.
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Byju’s said it disbursed a part of the pending salaries for all employees for February and promised to pay the balance once it is allowed to use the funds from the recently closed rights issue, as per a Moneycontrol report.
“We processed part salaries for everyone for February late night on Friday to the extent of capital we could get outside the rights issue. The company will pay the balance once the rights issue funds are available, which we expect shortly," said the company, in a letter to employees.
The company’s management added that it expects the salaries to be reflected in employee accounts on March 11, as it was delayed due to a second Saturday and on account of the long weekend, the report further revealed.
This comes after founder Byju Raveendran said the company will pay salaries by March 10, after it was unable to pay salaries to employees as the funds raised through a recent rights issue have been locked in a "separate account" due to the ongoing dispute with the investors.
“In the interim, we have made alternate funding arrangements to ensure your daily lives are not disrupted. Our commitment to serving our students with the passion and dedication they deserve remains as strong as ever, and we are taking all necessary measures to continue our operations smoothly,” the company added.
This comes as the National Company Law Tribunal (NCLT) in its order passed on February 27 directed the edtech company to keep funds received from the rights issue in an escrow account till the disposal of the oppression and mismanagement plea filed by four of the company's investors.
The company has laid off thousands of employees in the last 12 months as it battled a double blow of drying venture capital funding and slowing demand for online learning services. Since then, its investor board members have left too, citing differences with Raveendran.
The company has tried to fix some of the problems since then. Its early investor Ranjan Pai ploughed in the capital, it set up an advisory council with veterans such as Mohandas Pai and Rajnish Kumar and elevated Arjun Mohan as CEO. It is also in talks to divest assets such as Great Learning and Epic.
