Camshaft alleges that a unit of Byju’s is the beneficial owner of $533 million in funds

In court filings this week, Camshaft revealed that the $533 million it managed for Byju’s Alpha, a U.S. unit of the Indian edtech group Byju’s, was transferred to another 100% U.S.-based subsidiary of Byju’s. This disclosure contradicts allegations that the Indian firm utilized the services of the wealth manager to divert funds.

According to Camshaft’s filings, the capital was transferred to Inspilearn LLC, a Delaware-based subsidiary of Byju’s. Camshaft clarified that neither Byju’s nor any of its affiliates are limited partners in the hedge fund.

Byju’s responded to these revelations, stating that Camshaft’s disclosure aligns with the startup’s position that it remained the beneficiary holder of the capital. Byju’s emphasized that the Credit Agreement it entered into with the lenders did not specify how the funds were to be utilized, nor did it require a specific amount to be maintained as collateral.

The startup asserted, “The latest disclosure dispels fake narratives about $533 million being siphoned off.”

Last year, Camshaft Capital garnered media attention when lenders to Byju’s raised concerns about the legitimacy of the wealth adviser, alleging that the $533 million served as collateral for a $1.2 billion loan extended to the Indian startup. Some estranged investors in Byju’s later seized upon these allegations to cast doubt on the character of Byju’s founder, Byju Raveendran.

Additionally, Byju’s, valued at $22 billion in early 2022, is embroiled in a legal dispute with certain shareholders in Bengaluru, its home market, who are seeking to annul a rights issue at the edtech group.