A Singapore court has sentenced Byju Raveendran, founder of edtech company Byju's, to six months in prison for contempt of court over alleged non-compliance with disclosure orders. However, the founder has described the decision as "procedural," denied any wrongdoing, and said it will appeal. This sentence is considered the biggest legal setback for Byju's to date.
Byju's was once one of India's largest startups, but the severe recession following the COVID pandemic has left the company embroiled in a series of troubles. Byju's began to face disputes with its own investors, debt-related lawsuits, and operational turmoil, which rocked the company.
The court orders Ravindran to surrender
A Singapore court has ordered Ravindran to surrender to authorities, pay legal costs of 90,000 Singapore dollars (US$70,500), and produce documents related to his stake in Beeaar Investco Pte. Beeaar Investco Pte is a Singapore-based company that holds shares in another company linked to Byju's.
The case was filed by a subsidiary of the Qatar Investment Authority, which invested in Byju's at a time when the company was grappling with layoffs and mounting financial pressure. This contempt of court action adds another layer to the broader legal battles surrounding the company, including an ongoing lawsuit in the US in which lending institutions are seeking compensation for losses incurred on a $1.2 billion term loan.
"Unnecessarily prolonging the matter"
In a statement issued after the court's decision, Ravindran said that ongoing settlement negotiations with lending institutions and investors like GLAS Trust and QIA are now in their final stages. He described the court's latest action as "unnecessarily prolonging the matter."
Byju's, which began as Think & Learn Private Limited, became one of India's most talked-about technology startups during the pandemic-induced boom in online education. It garnered support from investors worldwide and, at one point, reached a valuation of $22 billion before its growth and finances began to decline significantly.
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