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Byju’s creditors request an earlier partial repayment of their $1.2 billion debt.

According to persons familiar with the situation, a group of creditors to Byju’s, the most valuable startup in India, have requested that the company immediately repay a portion of a $1.2 billion loan that they recently purchased while they renegotiate the terms of the debt.
According to the persons, who asked to remain anonymous because the information is private, the lenders have hired Houlihan Lokey Inc. to assist them on changing covenants after the edtech giant broke terms, including a September deadline for filing its results for the year ended March 31, 2022. According to them, Rothschild & Co. is negotiating on behalf of Byju’s.
According to two of the sources, the majority of the lenders in this group purchased the debt from primary holders in September when it fell to a record low of 64.5 cents in order to profit from expedited payback. Rothschild, Houlihan Lokey, and Byju’s spokespeople all declined to comment.
According to statistics collated by Bloomberg, the loan was trading at 80 cents on the dollar on Monday, while comparable debt from another Indian company, Oyo Hotels, is holding steady at or near the issue price.
According to the sources, Byju’s has already reached agreements on new terms with the bulk of its lenders, which include raising the interest rate on the loan, employing a chief financial officer, and submitting monthly business updates. According to a report by Bloomberg News earlier this month, the corporation is trying to renegotiate the loan as it struggles with significant losses and hitting its cost-cutting goals.
The persons added that a tiny number of creditors are still holding out hope that the $22 billion corporation will use some of the $850 million in cash reserves held by its US unit to payback a portion of the debt that has been outstanding for a year. According to JPMorgan Chase & Co., one of the deal’s bookrunners, the loan, which will be priced at 550 points over Libor in November 2021, is one of the largest unrated term loan B offers ever from a new-age company globally.

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ZZED Reporter

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