Byju’s had raised $1.2 billion in term loans from these lenders.
On August 2, the National Company Law Appellate Tribunal (NCLAT) approved this deal. It also dismissed the insolvency proceedings against Byju’s that had been initiated on the cricket board’s petition, returning the company’s control to chief executive Byju Raveendran.
According to the edtech firm, Judge Brendan Shannon of the Delaware Bankruptcy Court declined to intervene in legal proceedings taking place in another country’s judicial system.
Earlier, Byju’s legal counsel said any interference from the US court “would be an unimaginable insult to the system in India.”
“In my respectful submission, this is forum shopping and this is over reaching this hon’ble court,” Arun Kathpalia, Byju Raveendran’s counsel had said.
Discover the stories of your interest
Byju Raveendran’s brother and the company’s largest shareholder, Riju Ravindran, is paying for the settlement with the BCCI using his personal funds. His counsel had informed the NCLAT that no part of the money raised from the US lenders was used for this purpose.The appellate tribunal had dismissed the arguments presented by Glas Trust Company, noting that the National Company Law Tribunal (NCLT) had already granted it the right to revive a petition for initiating corporate insolvency resolution proceedings to recover its dues. The lenders alleged that Byju Raveendran had diverted over half a billion dollars from the $1.2 billion they had lent to the company.
On August 2, ET reported that the US lenders are likely to appeal against the NCLAT order in the Supreme Court, sources said.
“The Delaware Bankruptcy Court’s decision effectively puts an end to Glas’ attempts to forum shop. Glas had tried – and failed – to scuttle the settlement between BCCI and one of the promoters of Byju’s before the NCLAT in India, prompting them to approach the Delaware court for the same relief,” said Rishab Gupta, legal counsel for Byju’s.