Byju’s has filed a lawsuit against investment management firm Redwood, challenging the acceleration of a $1.2 billion term loan B facility.
Byju’s claims Redwood engaged in “predatory tactics” and violated the conditions of the loan facility.
The US company was accused of purchasing a significant portion of the loan while primarily trading in distressed debt.
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The lawsuit was filed in the New York Supreme Court.
Byju’s has also issued a notice to disqualify Redwood entities as a lender with critical rights under the term loan norms once it takes effect.
The EdTech company said: “We had to take these measures following a series of predatory tactics by the lenders, led by Redwood.”
In March, the lenders allegedly unlawfully accelerated the term loan B, citing certain non-monetary and technical defaults.
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As a result, they took unwarranted enforcement measures, including seizing control of Byju’s US unit, BYJU’S Alpha, and appointing new management.
Byju’s has decided to withhold further payment to the term loan B providers, including interest until the court resolves the dispute.
The company seeks a resolution through legal means, aiming to challenge Redwood’s actions and disqualify them as a lender in this case.
