An urgent decision has been made by an arbitrator directing Think and Learn, the parent company of Byju's, to refrain from selling approximately 6 percent of its stake in Aakash Education Services Limited. This directive comes in response to the failure of Think and Learn to repay around Rs 350 crore borrowed from MEMG Family Office, led by billionaire doctor Ranjan Pai.
Arbitration procedures were initiated by MEMG Family Office in March to safeguard its rights, based on the commitment made by Byju's when obtaining the loan.
A legal representative familiar with the matter, speaking on condition of anonymity, disclosed that the emergency arbitrator has instructed Byju's to abstain from transferring or encumbering the aforementioned stake in Aakash, in accordance with the commitment made during the loan agreement with MEMG Family Office. These directives were issued on April 4 by an emergency arbitrator appointed under the rules of the Singapore International Arbitration Centre.
While queries directed to Byju's and MEMG remained unanswered, an inside source from Byju's indicated that the arbitration ruling primarily maintains the existing state of affairs and does not pose a significant threat to the value of either AESL or Think and Learn.
"The arbitration initiated by MEMG is a procedural matter, and discussions are underway within Byju's to address it in a manner that aligns with the best interests of both companies," the source stated.
Byju's, a troubled player in the edtech sector, has been grappling with financial constraints since the onset of the pandemic and has encountered difficulties in meeting its employees' salary obligations.
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