US court bars Byju’s from using $533mn it borrowed – Times of India

MUMBAI: In a major setback for troubled startup Byju’s, a US bankruptcy court has passed an order in favour of the edtech company’s term loan lenders, disabling the firm from transferring or using $533 million received as part of loan proceeds, essentially freezing the assets.
The loan amount – which has been at the centre of dispute between Byju’s and its lenders – has been transferred from an obscure hedge fund Camshaft Capital, where it was previously held to an unnamed offshore trust, the group of lenders said in a statement on Friday.The court has asked founder and group CEO Byju Raveendran and wife Divya Gokulnath to comply with the ruling.

It has also ordered the arrest of William Morton, founder of Camshaft Capital, following his repeated refusal to appear in court and provide any information regarding the transfer of $533 million and the current status and location of the funds. “The fact that the parent company (Think & Learn) is attempting to hide where the assets are is huge. It shows that they are engaged in what appears to be a potential fraud,” the court observed in its ruling.
Byju’s had recently said that the $533 million has been parked with a non-US subsidiary of the firm but did not disclose any details. In a statement, Byju’s said the court order merely maintains “status quo” because it has always maintained that the said funds are parked in one of its subsidiaries.