According to a report, the Indian startup’s brick-and-mortar test preparation subsidiary, Aakash Institute, and Davidson Kempner Capital, a US-based fund manager that manages more than $38 billion, are discussing how to resolve their thorny issues over the breach of a loan agreement.
Byju’s is prepared to refund any funds it has obtained so far from the sanctioned loan, as well as the interest on that sum. However, Davidson Kempner (DK) wants interest on the entire sum for one to two years, rather than a quarter as indicated by the edtech firm’s founder, Byju Raveendran, according to the Economic Times, citing persons with firsthand knowledge of the case.
“The conversations focus on the specific pay-out. It will eventually come down to what both parties agree on. “It is also possible that the final settlement pay-out will fall somewhere in the middle,” a person intimately involved in the continuing discussions told the financial daily.
Byju’s acquired Aakash Educational Services Ltd (AESL) in April for about $1 billion (approximately Rs 7,300 crore) in an earnest attempt to expand its footprint in the country’s test preparation market.
DK’s main goal is to get its money out of Byju’s and conclude the chapter. According to the article, the two parties would likely make a formal proposal this week.
Meanwhile, Manipal Group chairman Ranjan Pai is scheduled to invest roughly $80 million in Aakash, which will be used to repay DK, and will acquire a stake in Aakash from Raveendran, according to the daily.
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