Edtech company Byju's, which was once India's most valuable start-up worth an estimated USD 22 billion, will face insolvency proceedings for failure to pay Rs 158.9 crore to cricket board BCCI.
The Bengaluru bench of the National Company Law Tribunal (NCLT) on Tuesday allowed bankruptcy proceedings against the firm and appointed an interim resolution professional, suspending the company's board of directors and freezing its assets.
Founder and CEO Byju Raveendran will report to the resolution professional.
NCLT has appointed Pankaj Srivastava as the interim resolution professional.
Byju's had previously sponsored the Indian cricket team.
While Byju's said it is hopeful of reaching "an amicable settlement" with the Board of Control for Cricket in India (BCCI), sources said the company plans to challenge the order before the appellate tribunal, NCLAT.
When contacted, a Byju's spokesperson said: "As we have always maintained, we wish to reach an amicable settlement with BCCI and we are confident that, despite this order, a settlement can be reached. In the meantime, our lawyers are reviewing the order and will take necessary steps to protect the company's interests."
Byju's was once valued at USD 22 billion but reopening of schools after easing of pandemic restrictions led to its unraveling.
BlackRock recently slashed its valuation of USD 1 billion.
The company's troubles began when it missed financial reporting deadlines two years ago and fell short of revenue projections by more than 50 per cent.