Byju’s Reaches Karnataka HC Against NCLT Order Prohibiting It From 2nd Rights Issue

The National business Law Tribunal’s (NCLT) judgement preventing Byju’s from proceeding with its second rights issue has been challenged in the Karnataka High Court by the Edtech business, which is embroiled in a number of disputes and facing financial difficulties.

The second copyright dispute was scheduled to conclude on June 13 after it started on May 13.

The NCLT has prohibited the edtech company from using any of the money from the second rights issue. According to sources, the Karnataka High Court is expected to hear the company’s new case on Monday.

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Byju’s is currently investigating out-of-court agreements with Teleperformance and Surfer Technologies, two of its creditors.

The cases were postponed until June 26 by the NCLT.

The edtech company, which was once valued at $22 billion, is currently worth nothing, according to a recent research report from the banking institution HSBC.

Prosus, an investment business, owns around 10% (or $500 million) of Byju’s, yet HSBC gave it no value.

The note said, “We assign zero value to Byju’s stake amid multiple legal cases and funding crunch.”

A group of lenders filed for bankruptcy in a US court earlier this month, claiming that new businesses connected to Byju’s US company were not fulfilling their debt obligations.

Byju’s Alpha filed for Chapter 11 bankruptcy protection in the United States in February of 2024.

Through monthly “collections,” the business was able to process the employee salaries for May.