Byju’s Under New CEO: Massive Restructuring May Result in 4,000-5,000 Employee Departures
Written by Sanjay Kumar
In a strategic move to streamline its operations and address financial challenges, Byju’s, one of the world’s leading edtech companies, has unveiled a massive restructuring plan under the leadership of its new CEO, Arjun Mohan. This restructuring initiative may result in the elimination of approximately 4,000 to 5,000 jobs, according to reports.
Arjun Mohan, a seasoned veteran within the Byju’s organization, assumed the role of CEO for Byju’s India operations recently. He has wasted no time in initiating this significant overhaul, which aims to optimize the company’s operations and finances.
The job cuts are expected to primarily impact employees based in India who work for Think and Learn Pvt. Ltd., the corporate entity behind Byju’s. Notably, these layoffs will not extend to employees of Aakash Educational Services, a subsidiary of Byju’s.
Arjun Mohan has communicated these restructuring decisions directly to senior leaders within the organization. The job cuts are anticipated to span across various functions, including sales, marketing, and other areas where redundancies exist. Arjun Mohan’s appointment as CEO followed the departure of Mrinal Mohit, another long-standing member of the company.
These layoffs come at a crucial juncture for Byju’s, as the edtech giant grapples with severe liquidity constraints. The company has already taken measures to address its financial challenges, such as relinquishing office space, considering the sale of certain subsidiaries, and actively seeking external funding. Byju’s has previously undergone multiple rounds of layoffs as well.
A spokesperson from Byju’s stated, “We are in the final stages of a business restructuring exercise to simplify operating structures, reduce the cost base, and enhance cash flow management. Byju’s new India CEO, Arjun Mohan, will complete this process in the coming weeks and guide a revitalized and sustainable operation moving forward.”
The urgency to conserve cash is driven by Byju’s need to navigate an impending liquidity crunch, particularly with ongoing commitments to lenders. Just this month, Byju’s presented a proposal to its lenders, outlining plans to repay its disputed $1.2 billion term loan B within the next six months, with an upfront payment of $300 million within three months. As part of its financial strategy, the company is exploring the restructuring of subsidiaries and the potential sale of key assets, including Great Learning and U.S.-based Epic, to generate funds for repayment.
Simultaneously, Byju’s is actively seeking fresh equity funding. Despite being one of the world’s largest edtech firms, valued at approximately $22 billion, the company has encountered challenges in closing fundraising rounds due to a myriad of domestic and international hurdles.
In May, Byju’s secured $250 million in structured instruments from Davidson Kempner, though a significant portion was held back by the U.S.-based AMC due to challenges in the company’s lender negotiations. Notably, Byju’s experienced a technical default on the Davidson Kempner loan, prompting efforts to secure funds for repayment to safeguard control of Aakash Educational Services. Shares of Aakash had been offered as collateral for the Davidson Kempner loan.
In addition to these initiatives, Byju’s is exploring fundraising options from one of its earliest backers, Ranjan Pai, for Aakash Educational Services. It has been reported that Pai may acquire a portion of Byju Raveendran’s stake in Aakash, with Raveendran currently holding approximately 30 percent of the shares.
Byju’s continues to adapt and strategize in response to evolving market conditions, aiming to secure its financial stability and further strengthen its position in the dynamic edtech industry.
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