After $1.2 Billion Repayment Proposal, Troubled Byju's Alleged To Hide $533 Million In Hedge Fund

Right after reports said that Indian ed-tech giant, Byju's has made a proposal to repay its entire $1.2 billion debt dues, the company is trapped in another scandal. This time, a report have stated that Byju's allegedly hid $533 million in an obscure three-year-old hedge fund.

As per a Bloomberg report which cited lenders who are trying to recover the cash from Byju's stated that the allegedly hid $533 million in an obscure three-year-old hedge fund that once said its principal place of business was an IHOP pancake restaurant in Miami.

The report cited court papers which revealed that last year, Byju's transferred more than half a billion dollars to an investment firm founded by William C. Morton, Camshaft Capital Fund. This transaction was done reportedly when Morton was just 23 years old. The lenders stated that Morton's fund received the money despite an apparent lack of formal training in investing.

Further, since the transfer took place, the lenders pointed out reportedly that a 2023 Ferrari Roma, a 2020 Lamborghini Huracán EVO, and a 2014 Rolls-Royce Wraith - have been registered in Morton's name.

According to these lenders, reportedly, Byju's has taken great lengths to hide the whereabouts of borrower's $533 million for the admitted purpose of hindering and delaying.

On September 11, it was Bloomberg News who reported that Byju's has made a proposal to its lenders to repay the entire $1.2 billion of its debt. The company plans to repay its obligations in less than six months. Also, that the lenders were reviewing the proposal and are seeking more details on how Byju's plans to fund the repayment. As per the sources, the company has offered to $300 million of the distressed debt within three months if the amendment proposal is accepted and the remaining amount in the subsequent three months.

Byju's which was once India's most valuable at $22 billion, has been struggling to file its financial accounts on time, defaulted on dues payment, sparked a legal feud with lenders, and also facing a funding crunch. The company has also witnessed low demand in business.

Byju's overseas investors have been pulling out their money from the global ed-tech company.

In May, it was known that investment firm BlackRock trimmed its valuation to $8.4 billion, later on, in June, the annual report stated that the Dutch-listed technology investor Prosus NV also reduced its valuation to $5.1 billion. By then, about a 75% drop was recorded in the valuation of $22 billion that was achieved last year.