Byju’s insolvency: NCLT approves new resolution professional

Embattled ed-tech firm Byju’s has a new navigator for its bankruptcy proceedings.

On Monday, the Bengaluru insolvency court approved the appointment of Shailendra Ajmera as the resolution professional (RP), replacing Pankaj Shrivastava. This follows a January order by the National Company Law Tribunal (NCLT), which questioned Shrivastava’s ability to oversee the process. The tribunal also cancelled a Committee of Creditors (CoC) reconstitution he carried out on 31 August 2024, reinstating the previous CoC formed on 21 August 2024.

The move marks a critical shift in Byju’s insolvency battle, which has pitted the company’s dissenting lenders—Glas Trust LLC and Aditya Birla Finance—against its suspended directors, including Riju Raveendran, brother of founder Byju Raveendran.

At stake is not just control over the company’s future but also a ₹158 crore settlement with the Board of Control for Cricket in India (BCCI)—a deal that could determine whether Byju’s remains in insolvency or regains its footing.

Read this | Mint Explainer: Why Byju’s creditors have dragged its insolvency professional to court

Ajmera, a chartered accountant and partner at Ernst & Young (EY), steps into a challenging role. His most recent stint as RP for Go First ended in controversy, with the airline ordered into liquidation after failing to secure a revival plan. Lessors of the airline had filed a contempt case against him, alleging mismanagement of grounded planes and asset deterioration.

A resolution professional manages the insolvency process, from handling creditor claims to maintaining operations and ensuring regulatory compliance.

Beyond Go First, Ajmera has handled insolvency proceedings for Ruchi Soya, Coffee Day Global, Rolta India, and Supertech Orb Project. Now, as Byju’s RP, he must steer the company through its bankruptcy, mediating between lenders and former directors while working within court-mandated timelines.

Byju’s power struggle

Byju’s former directors, led by Riju Raveendran, are pushing for the company’s exit from insolvency. Their key argument? The ₹158 crore settlement with BCCI was finalized before the CoC was formed—meaning creditors should not have a say in the matter.

Read this | Byju’s EGM casts out founders, but company says not yet

On 10 February, the tribunal directed BCCI to submit the settlement plea to the CoC for approval. But lenders, particularly Glas Trust, have opposed the deal, calling the ₹158 crore “tainted money” and demanding that creditor dues take priority.

If the National Company Law Appellate Tribunal (NCLAT) rules that the BCCI settlement predates the CoC’s formation, Byju’s could exit insolvency, restoring control to Byju Raveendran. If not, the CoC’s approval would be required—giving lenders the upper hand in Byju’s fate.

Court proceedings

Byju’s bankruptcy proceedings stem from a default on 16 June 2024 on a ₹158 crore payment to BCCI for the firm’s sponsorship of the Indian cricket team jersey.

Once India’s most valuable ed-tech startup, Byju’s, founded in 2011, pursued aggressive acquisitions, but soon ran into financial trouble, regulatory scrutiny, and disputes with creditors.

Also read | As Byju’s-burnt private investors turn cagey, edtech startups take IPO route to grow

In October 2024, the Supreme Court quashed an NCLAT order, ruling that it had bypassed due process under insolvency laws and directed all parties back to the NCLT.

Byju Raveendran currently resides in Dubai, while Riju is based in London.