Byju's Chief Financial Officer Resigns After Six Months Due to Delayed Financial Accounts
Ajay Goel, who assumed the role of Chief Financial Officer at Byju's in April this year, has swiftly resigned, marking the latest in a series of challenges faced by the edtech giant. Byju's announced his departure on Tuesday, noting that Goel will exit the company after successfully completing the long-overdue audit requirements for the financial year ending in March 2022.
He will then return to his position within the mining conglomerate Vedanta by the end of this month, according to Byju's.
In response to Goel's resignation, Byju's has appointed industry veteran Pradip Kanakia as a senior advisor and promoted Nitin Golani, who currently serves as the President of the startup's financial division, to the position of CFO.
Goel expressed his gratitude, saying, "I thank the founders and colleagues at Byju's for helping me assemble the FY22 audit in three months. I appreciate the support received during a short but impactful stint at Byju's."
This latest development is another blow for Byju's, India's most valuable startup, which had previously received valuation estimates of up to $50 billion for an IPO. The company is currently grappling with a range of issues related to governance, finance, and public perception.
Byju's is currently in negotiations with a consortium of lenders regarding a $1.2 billion term-B loan. Additionally, the startup is embroiled in a dispute with Davidson Kempner, a firm that had initially agreed to provide up to $250 million in credit to Byju's but is now pushing for payment due to a technical default clause.
Goel's resignation follows Deloitte's withdrawal from the startup in June of this year, along with the departure of three key board members from Byju's. A month later, Prosus, one of Byju's early backers and the owner of over 9% of the company, publicly criticized the Bengaluru-based startup for its failure to evolve and for disregarding investor advice and recommendations, resulting in a markdown of Byju's valuation to $5.1 billion.
Deloitte's resignation letter in June stated that Byju's, which had a history of delaying the filing of its financial accounts, had not provided any updates on the resolution of the audit report for the financial year ending on March 31, 2021, nor had it offered information on the status of readiness of the financial statements and underlying books for the subsequent financial year ending in March.
Byju's has been grappling with financial difficulties, with more than 10,000 job cuts made in response to changing market conditions. The company has also repeatedly postponed the filing of its financial accounts for March 2022. To address its financial obligations, Byju's is exploring the sale of many of the businesses it acquired in 2020 and 2021, having spent approximately $2.5 billion on these acquisitions.