Byju’s Update: Well-known edtech company Byju’s troubles are increasing instead of ending. Now the Ministry of Corporate Affairs of the Central Government has ordered an inquiry into Baiju’s account. The inquiry report has been asked to be submitted within the next six weeks. Earlier there were reports that the SFIO (Serious Fraud Investigation Office) has also started an investigation against Byju, although the company denied it.
According to a Bloomberg report, there was a competition to resign in Baiju. Three board members, starting with the company’s auditor, resigned last month. The Ministry of Corporate Affairs has decided to probe Baiju’s account after the findings of the company’s internal assessment came to light. The government will then decide whether there is a need to conduct an inquiry with the SFIO as well.
There was no statement from Baiju on the probe by the Ministry of Corporate Affairs. On the other hand, the Ministry of Corporate Affairs has not yet said anything in this matter. However, this investigation may increase Baiju’s difficulty. Because the company is preparing to renegotiate to restructure a $1.2 billion term loan in violation of several terms of the debt agreement.
Last month, Deloitte Haskins Sales resigned as auditor due to delays in the submission of Byju’s financial statements. Apart from this, representatives of Peak XV, Prosus NV and Chan-Zuckerberg Initiative resigned from Byju’s board. The resignation has dealt a huge blow to Baiju’s image.
Baiju is working on a plan to raise a billion dollars to come out of the financial crisis. But the company has been in the news for recent layoffs. Last month there was news that Baiju is once again preparing for retrenchment. The layoffs are estimated to affect approximately 500 to 1,000 full-time employees. The company is looking to cut costs due to slowing growth and tough macroeconomic conditions. In October last year too, Baiju said it may lay off 2,500 employees to cut costs.
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