Byju Raveendran, founder of Indian edtech firm Byju’s, allegedly tried to persuade a U.S. businessman to flee the country to avoid testifying in federal court about suspicious activities witnessed while working with Raveendran.
In a declaration filed in the U.S. Bankruptcy Court in Delaware, Nebraska-based William R. Hailer, chief executive of consulting firm Rose Lake Inc. said: “Raveendran arranged a ticket for me to Dubai on Emirates out of Chicago, Illinois to avoid testifying and to be out of the country as an excuse if required to testify.”
Rose Lake Inc. was reportedly in talks with Byju’s parent company Think & Learn to acquire its term loan B of $1.2 billion and edtech company Epic!. However, a group of U.S. lenders, represented by Glas Trust, have filed a bankruptcy case against Think & Learn and are involved in a legal battle in India as well.
According to Bloomberg, which first reported on the case, Raveendran became concerned that Hailer might testify after he found out that the latter was named as a witness in a court filing, Hailer told the court on Thursday.
Hailer also claimed that Raveendran had promised him a full-time position with a salary of at least $500,000 per year, along with an equity stake in the company. “I was also told by Raveendran that he would move me and my family to Dubai, arrange housing and schools and ensure we have the same quality of life that he has,” Hailer said.
Hailer, reflecting on his meetings with Raveendran in Dubai, said the latter’s behavior seemed unusual for someone conducting legitimate business.
READ: ‘Byju’s worth zero,’ says founder of once India’s biggest edtech startup (October 18, 2024)
“Most times, Byju carried three phones. He used personal email instead of work email for communications. He would isolate people into individual meetings or only include for certain periods of time,” Hailer said.
“On one occasion, while Byju was showing me how AI worked, a ChatGPT screen showed a previous search for how to defend against corporate fraud accusations,” he alleged.
According to Hailer, Raveendran reportedly said he would sell Aakash Institute’s shares to Ranjan Pai of Manipal Education and Medical Group, regardless of the outcome of a term loan B deal, using the funds to start a new company if needed.
On November 19, Glas Trust raised concerns about an extraordinary general meeting (EGM) called by Aakash Institute, fearing it could impact Byju’s insolvency process. The EGM sought to change Aakash Institute’s articles of association (AoA), potentially reducing Byju’s control and granting special rights to Manipal, which holds 40% of the company.
Byju’s, which was once India’s biggest edtech startup, rose to prominence during the COVID-19 when schools were shut down and students were quarantined at home. Offering virtual education, Byju’s expanded its services to 21 countries and hit a valuation of $22 billion in 2022.
Facing allegations of unpaid dues and mismanagement, Byju’s went into insolvency after U.S. lenders took to the Indian Supreme Court in August to file a dispute of misusing $1 billion borrowed by the company.
Raveendran went from an Indian mathematician and teacher to a billionaire entrepreneur, only to see his edtech firm face significant allegations and setbacks earlier this year.