In a significant court ruling, Tech firm Think & Learn Pvt, known by its commercial name Byju’s, is confronted with a directive from a US judge to safeguard $533 million for apprehensive creditors who insist that these funds are designated to repay their debts. The order, issued by US Bankruptcy Judge John Dorsey, strikes a compromise for the lenders who had previously urged that the money be entrusted to federal court custody, ensuring it is not expended by the firm. Judge Dorsey’s directive focuses on Riju Ravindran, a director of Think & Learn and brother to the founder Byju Raveendran, who is tasked with uncovering the exact location of the funds.
Amid allegations of financial difficulties, Think & Learn is engaged in legal proceedings with its lenders in Delaware and New York. A subsidiary dubbed Byju’s Alpha was established by Think & Learn for a massive $1.2 billion debt issuance, which is currently under bankruptcy and the domain of Judge Dorsey. A hearing brought forth revelations of the resignation of three Think & Learn directors, concentrating control within the Ravindran family, and emphasized the urgency to reclaim funds as the company grapples with instability.
The federal court’s intervention extended to ordering the arrest of William C Morton, head of a small Florida hedge fund alleged to be involved with concealing Byju’s cash, on grounds of contempt of court for non-cooperation. Morton is faced with a daily fine until he provides information on the monetary trail, which included a brief passage through his hedge fund Camshaft Capital Fund before being transferred to an unnamed off-shore trust. This action reflects an ongoing skirmish between lenders and Think & Learn over more than $1.2 billion owed and implicates Byju’s founders in efforts to evade the creditors.
Lenders have taken serious legal steps to recover the said $533 million, presumed to have been moved to an offshore trust by involved parties. They claimed that Byju Raveendran, and his wife Divya Gokulnath, were acting alongside the relevant parties in this financial scandal. As the legal drama unfolds, the interwoven transactions between Byju’s Alpha, Camshaft Capital Fund LP, and Inspilearn LLC have triggered a red alert amongst creditors, prompting a strong legal response.