• Home
  • Cricket News
  • Setback For Bcci Supreme Court Stops Byjus Settlement As Edtech Giant Nears Insolvency

Setback For BCCI! Supreme Court Stops Byjus Settlement As Edtech Giant Nears Insolvency

Supreme Court of India ordered stay on Byju's debut settlement with BCCI (@BYJUS,@BCCI/X.com)Supreme Court of India ordered stay on Byju's debut settlement with BCCI (@BYJUS,@BCCI/X.com)

In a major setback for the Board of Control for Cricket in India (BCCI), the honorary Supreme Court of India has rejected the settlement order passed by an Indian appeals court which allowed BCCI and other creditors to recover their money from bankrupt Edtech company Byjus. This ruling also marks a significant setback for founder Byju Raveendran, who has been struggling to regain control of the company amidst severe financial issues.

Byjus, an online education company launched by Byju Raveendran, boomed during lockdown and was once valued at $22 billion. The Edtech giant that revolutionised India's startup culture signed a sponsorship deal with BCCI before witnessing a dramatic fall post-Covid pandemic.

BCCI unlikely to recovery losses from defaulter Byjus

With irrecoverable losses, Byjus filed for bankruptcy and agreed to reach a settlement with BCCI to avoid insolvency. While an Indian appeals court passed the settlement order, US creditors Glas Trust challenged the judgment in the Supreme Court. They apparently staked a claim of $1.2 billion in debt recovery and appealed to disallow Byjus from paying BCCI before they clear their pending debt.

With the Supreme Court now rejecting the settlement order, Glas Trust and BCCI are forced to return to bankruptcy court, both uncertain of how and when they will receive their dues. Notably, BCCI owes $18.9 million from Byjus, and this settlement would have covered the losses had Glas Trust not intervened.

The case now heads to India's insolvency courts, where a court-appointed professional will oversee the company's operations. 

This development casts a shadow over future financial recoveries for Byjus and the BCCI, while it serves as a stark reminder to the broader Indian startup ecosystem of the risks associated with rapid growth and reliance on external funding.

BCCI not in a hurry to announce Jay Shah's successor

With Jay Shah heading to ICC to take over as chairman from December 1, 2024, BCCI's secretary post stays empty. While lawmaker and DDCA president Rohan Jaitley is viewed as the front-runner to replace Shah, the secretary post is not on the agenda for the board's upcoming Annual General Board Meeting (AGM). It suggests that the BCCI is not in a hurry to replace Jay Shah just yet, as his official signing with ICC is still pending.