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Dutch investor Prosus NV trims Byju’s valuation to $5.1 billion

Earlier this year, Byju’s minor investor BlackRock also reduced the valuation of a troubled Indian edtech startup to $8.4 billion.

 

Dutch multinational investor Prosus NV has trimmed the valuation of Indian EdTech startup Byju’s to $5.1 billion, according to a Reuters report that cited its annual report. This is over a 75% decline in Byju’s $22 billion valuation last year.

 

The media report further added that Prosus has slashed the value of its 9.6% stake in the Bengaluru-headquartered startup to around $493 million in the financial year ended March 31. Prosus, which is Byju’s biggest investor shareholder, has also stepped down from the startup’s board along with other investors.

 

The valuation markdown is coming at a time when market conditions are volatile and global cues are weak, while the startup’s funding winter has been stretching since last year. Earlier this year, Byju’s minor investor BlackRock also reduced the valuation of a troubled Indian edtech startup to $8.4 billion.

 

The move also comes as Byju’s is looking to work around the repayment of a $1.2 billion term loan B (TLB) that it secured in late 2021 for five years. The Economic Times reported in December last year that some creditors have asked Byju’s for a faster repayment of the term loan, while also renegotiating the terms of the debt. Earlier this month, the Indian startup filed a complaint with the New York Supreme Court against an investment management firm Redwood to challenge the acceleration of the $1.2 billion TLB and sought to disqualify the lender, alleging it of “predatory tactics.” Byju’s said it has decided to not make any further payments to the term B loan providers, including any interest, until the dispute with the lenders is decided by the court.

 

Once India’s most valuable edtech startup, Byju’s has also seen the exit of board members representing three global investors – Peak XV Partners (formerly Sequoia Capital India), Prosus NV, and the Chan-Zuckerberg Initiative – and auditor Deloitte last week due to “long-delayed” financial filings for the year ended March 2022. However, later the beleaguered company informed investors that it will submit audited earnings for 2022 by September and 2023 results by December. Still, the departures raise concerns about the company’s corporate governance, especially following a recent raid on Byju’s premises for alleged violations of foreign exchange laws.

 

Meanwhile, earlier this week, another Reuters report highlighted that India’s Employees Provident Fund Organisation (EPFO) had identified a shortfall in payments from Byju’s for August 2022 to May this year. Later, it was reported that the startup has deposited Rs 1.23 billion after the EPFO’s directives, and assured to deposit the remaining balance of Rs 34.3 million within a couple of days.

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