Amid a cash crunch, BYJU’S has reportedly delayed the payment date for full and final dues of its laid off employees to November from September.
The edtech giant had fired around 1,000 employees across departments, including mentoring, logistics, training, sales, post-sales, and finance, in June. At the time, BYJU’S said it was a strategic step towards achieving profitability.
The employees, who were impacted by the retrenchments, were told they would receive their final settlements by September 15. However, according to a Moneycontrol report, the company sent an email to the affected employees on September 14, notifying them of a delay in disbursing their dues.
According to the new timeline provided in the said email, the employees can expect to receive their outstanding payments by November 17. “This is to inform you that the full and final settlement amount will be released latest by 17th November 2023,” the mail cited by the publication said. “We are sorry for the inconvenience caused.”
A BYJU’S spokesperson told Inc42 the edtech unicorn is committed to meeting all its obligations as soon as possible. “We regret and acknowledge the delays in settling dues of former employees. As we work through a difficult business restructuring, we are committed to meeting all our obligations as soon as possible,” the spokesperson said.
The edtech giant, valued at $22 Bn during its last funding round, is going through a significant cash shortage, as it tries hard to fulfil its obligations. It recently proposed a full repayment of its $1.2 Bn Term Loan B to the lenders within the next six months, even as it tries to close a funding round.
In its proposal, BYJU’S said it aimed to complete the repayment by making an initial payment of $300 Mn within the next three months. As part of its efforts to secure the funds, the edtech giant has put up two of its US-based subsidiaries – Great Learning and Epic – on sale to raise up to $1 Bn.
On the other hand, the edtech giant is also in talks with new and existing investors, including Middle Eastern sovereign wealth funds, to raise a funding round. While details are sparse, the round is said to be worth anywhere from $200 Mn to $1 Bn.
BYJU’S has been in a constant state of battle for the past 12 months or so for a host of issues, including delay in publishing financial results and the resignations of its auditor, Deloitte, and three key board members – Peak XV Partners (Sequoia Capital India)’s GV Ravishankar, Prosus’ Russel Dreisenstock and Chan Zuckerberg Initiative’s Vivian Wu.
It has also come under fire for employee-related issues, including delays in making provident fund payments, mass layoffs and holding back incentives. Earlier this year, BYJU’S also gave up a large amount of office space in Bengaluru to save costs.
Meanwhile, it is also engaged in a legal tussle with its lenders, who claim BYJU’S hid around $533 Mn from them. In its defence, the edtech giant argued it parked the said money in some ‘high-security fixed instruments’.
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