Dutch investor Prosus has marked down the value of its stake in edtech giant BYJU’S, taking the valuation of the embattled company to under $3 Bn. This is a sharp decline of over 85% from $22 Bn, the valuation of BYJU’S during its last fund raise.
During its earnings call, Prosus interim chief executive Ervin Tu said BYJU’S has been facing multiple challenges and Prosus, along with the edtech giant’s investors, has been helping the startup get back on track.
Tech Crunch was first to report on this development.
Prosus, which owns a 9.6% stake in the Byju Raveendran led startup, has been marking down the valuation of its stake in the startup since the beginning of this year. Its last such mark down in June valued BYJU’S at $5.1 Bn.
Besides Prosus, BlackRock, which owns less than 1% stake in BYJU’S, also slashed BYJU’S valuation earlier this year.
It is also pertinent to note that Prosus’ Russell Dreisenstock resigned from the board of BYJU’S, along with Peak XV Partners’ GV Ravishankar and Vivian Wu of Chan Zuckerberg Initiative, in June this year.
Later, Prosus said that Dreisenstock’s decision to step down from the board of BYJU’S was taken after it became clear that he was unable to fulfil his fiduciary duty to serve the long-term interests of the company and its stakeholders.
“Despite repeated efforts from our director, executive leadership at BYJU’S regularly disregarded advice and recommendations relating to strategic, operational, legal, and corporate governance matters,” Prosus said in a statement on Dreisenstock’s exit from BYJU’S board.
No End To BYJU’S Troubles
The valuation markdown appears to be a minor concern for BYJU’S at this point, considering the multiple challenges it is facing right now. On Tuesday, it was reported that the Board of Control for Cricket in India (BCCI) has dragged BYJU’S to the National Company Law Tribunal (NCLT) in relation to a dispute around the sponsorship rights of the Indian cricket team’s jerseys.
Besides, the Enforcement Directorate (ED) has sent show cause notices to BYJU’S and its eponymous founder Byju Raveendran in regards to alleged FEMA violation worth over INR 9,000 Cr.
Multiple delays in releasing its financial statements for the years FY22 and FY23, layoffs of thousands of employees, multiple top-level exits, and a potential debt crisis have further added to the woes of BYJU’S, once the posterboy of the Indian startup ecosystem.
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