Troubled edtech firm, Byju’s which is undergoing insolvency proceedings, is now faced with more problems. Amazon Web Services and Vodafone Idea have suspended their services to it over unpaid dues. While, AWS was providing cloud services, Vodafone Idea was the sole mobile network service provider to the firm.
The suspension has reportedly led to frequent crashes of Byju’s mobile app and inaccessibility of its common contact number since early this month. While its website remains operational, server-related issues have become increasingly common. Internal sources also indicated that work at the firm has come to a standstill, with many employees having left the company, while others are actively seeking new opportunities.
When contacted, Byju’s denied the suspension of services, stating that its app and website remain fully operational. The company said it has moved its databases to Google Cloud. Vodafone Idea and AWS could not be reached for their comments.
This isn’t the first time Byju’s has faced issues with vendor payments. In August last year, its employees had temporarily lost access to data management tools like Salesforce, Tableau, and ToolJet.
The developments relating to unpaid dues of AWS and Vodafone Idea comes at a time when Byju’s is also involved with tiff with its US-based creditor, Glas Trust Company LLC over a $1.2 billion loan which is took in 2021. While Byju’s founder and CEO, Byju Raveendran has claimed that the company’s verified debt is only around Rs 20 crore, and that Byju’s may not have to pay the US lenders; Glas Trust has refuted such claims.
According to the US-based lender, Byju’s is obligated to repay the full $1.2 billion loan plus interest. Glas Trust has also claimed that Byju’s has not paid any contractual dues in over 17 months.
On Tuesday, the matter came up in the Supreme Court, where Glas Trust said that it has wrongly been removed from the committee of creditors (CoC) by the interim resolution professional (IRP) dealing with the insolvency proceedings against ed- Byju’s.
The submissions were made by senior advocate Kapil Sibal, appearing for the US firm, before a bench comprising Chief Justice D Y Chandrachud and Justices JB Pardiwala and Manoj Misra which commenced the hearing in the case.
“I am the guarantor, which has the stakes of Rs 12,000 crore in Byju’s. My stake is 99.41% and this has been reduced to zero by the IRP,” Sibal said, adding that those having the stakes of 0.59% now have 100%. “I do not want the IRP to proceed,” he said. The proceedings are slated to continue.
From: financialexpress
Financial News
