Lenders allege Byju’s hid $533 mn in hedge fund
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New Delhi: Lenders have alleged that Byju's hid $533 million in an obscure three-year-old hedge fund to avoid it being seized to make up for a loan default, but the ed-tech titan claimed its agreement with lenders did not explicitly proscribe movement of funds.
Byju's US-based subsidiary Alpha Inc transferred more than half a billion dollars to Camshaft Capital Fund in 2022, Bloomberg reported, citing a lawsuit in US court. The investment firm, founded by William C Morton when he was just 23 years old, received the funds despite an apparent lack of formal training in investment.
Since the transfer, luxury cars - a 2023 Ferrari Roma, a 2020 Lamborghini Huracan EVO, and a 2014 Rolls-Royce Wraith - have been registered in Morton's name, according to a lender petition in the court. Lenders claim the cash was collateral for a $1.2 billion loan and now want control over it as there has been a default in payments. Byju's, however, said the transaction was fully within the bounds of its credit agreement with lenders, which explicitly does not proscribe or limit the movement or investment of funds disbursed under its terms.
