Byju’s moves New York Supreme Court challenging acceleration of $1.2 bn Term Loan B
1 min read 06 Jun 2023, 11:16 AM ISTBYJU’S has alleged that TLB lenders issued a notice demanding immediate payment of the entire amount under the TLB, despite knowing that the purported acceleration was under challenge before the court
PremiumEdtech major Byju’s has filed a suit in the New York Supreme Court against investment management firm Redwood, challenging the acceleration of a $1.2 billion term loan B (TLB) facility.
The Indian education technology startup has also sought to disqualify the lender for its “predatory tactics".
Byju’s has alleged that TLB lenders issued a notice demanding immediate payment of the entire amount under the TLB, despite knowing that the purported acceleration was under challenge before the court.
The company said Redwood purchased a significant portion of the loan while primarily trading in distressed debt, which was contrary to the conditions of the term loan facility.
As per Byju's statement, it has also issued a notice to Redwood entities disqualifying the investment firm as a lender with critical rights under the term loan norms once it takes effect.
"We had to take these measures following a series of predatory tactics by the lenders, led by Redwood," the startup said.
In March, the lenders unlawfully accelerated the term loan B due to certain alleged non-monetary and technical defaults, the company said.
The lenders undertook unwarranted enforcement measures, including seizing control of its U.S. unit BYJU'S Alpha and appointing its management, it addded.
The company said it has chosen not to make further payment to the term B loan providers, including any interest, until the dispute is decided by the court.
(With inputs from Reuters)
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