Why Byju’s unable to pay salaries to employees?
Byju’s CEO Raveendran has announced that the company is facing challenges in paying employee salaries due to investors blocking funds. Raveendran stated that despite successfully closing a rights issue to raise funds, the money is inaccessible because of a legal dispute with investors.
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In a letter to staff, Raveendran expressed regret that salaries cannot be processed at this time, despite having funds available. The board is working to resolve the issue and aims to pay employees by March 19. Raveendran assured employees that as soon as the legal hurdles are cleared, salaries will be paid promptly.
Raveendran criticized a few investors for preventing the company from accessing the funds raised through the rights issue. He highlighted that some investors have made significant profits from their investments in Byju’s but are still hindering the company’s ability to pay salaries.
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Last month, Byju’s launched a rights issue to raise emergency funding of $200 million, significantly reducing the company’s valuation. The National Company Law Tribunal (NCLT) has instructed Byju’s to keep the funds from the rights issue in a separate account until the legal matter is resolved.
Despite the challenges, Byju’s is committed to resolving the issue and ensuring that employees are paid their salaries as soon as possible. The company is working to overcome the obstacles created by investors and hopes to resume normal operations soon. Why Byju’s unable to pay salaries to employees?
