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Financial Restructuring

Finance Ministry Approves IFCI Group Consolidation Plan

Leave a Comment / By / Human Resource Community

The Department of Financial Services (DFS) under the Finance Ministry has granted ‘in-principle’ approval for the consolidation of the IFCI Group, marking a significant step toward restructuring and streamlining its operations. The plan involves the merger or amalgamation of IFCI Limited, StockHolding Corporation of India Limited, and other group companies to form a unified financial entity. In tandem, the board of IFCI Limited has also provided its nod to initiate the consolidation process. IFCI Limited confirmed the development in a regulatory filing on Friday, noting that the plan will be executed in compliance with all applicable laws and regulations. Consolidation Plan Highlights: Merger Entities: Key companies, including StockHolding Corporation of India Limited, IFCI Factors Limited, IFCI Infrastructure Development Ltd, and IIDL Realtors Limited, will be merged with IFCI Limited, the publicly listed parent entity. Subsidiary Restructuring: Subsidiaries such as StockHolding Services Limited, IFCI Financial Services Limited, IFIN Commodities Limited, and IFIN Credit Limited will be consolidated into a single subsidiary of the parent entity. Direct Subsidiaries: Other group entities, including StockHolding Document Management Services, IFIN Securities Finance, and IFCI Venture Capital Funds, will become direct subsidiaries of the consolidated listed entity. The Centre has been actively supporting IFCI Limited, infusing ₹500 crore in April 2024 through equity allotment at ₹40.33 per share. This backing has coincided with IFCI’s improving financial performance, with the company reporting a net profit of ₹185 crore for Q2 FY2024, up 7% from ₹173 crore in the same quarter last year. The consolidation is expected to enhance operational efficiencies and reinforce the group’s market positioning, driving future growth in India’s financial sector. Source: thehindubusinessline Photo Credit: thehindubusinessline

Byju’s Seeks Fresh Funds, Slashes Valuation by 90% to Tackle Financial Woes

Leave a Comment / By / Education Community

Indian education giant Byju’s is reportedly planning to raise funds through a share issuance next month, seeking over $100 million from existing investors. The catch, however, is that the valuation of the once $22 billion startup will plummet by more than 90%, now placing the company at less than $2 billion. Sources familiar with the matter revealed that Byju’s founder, Byju Raveendran, will partake in the share sale to maintain his stake in the company. The move comes as Byju’s grapples with financial challenges, planning to utilize the proceeds to settle outstanding payments to vendors and stabilize its operations. Byju’s had previously attained a valuation of $22 billion during its funding round in late 2022, marking a significant decline in its perceived value. The company has been navigating a cash crunch for several months and is concurrently engaged in a legal dispute with creditors over a missed interest payment on a $1.2 billion term loan. In a bid to alleviate financial pressures, Byju’s is set to sell its US-based kids’ digital reading platform for approximately $400 million. The spokesperson for the company has declined to comment on the recent developments. Post the share sale, Byju’s aims to refocus on its core business and intensify efforts in the realm of generative artificial intelligence for hyper-personalized learning. Backed by prominent investors like the Chan Zuckerberg Initiative, General Atlantic, and Prosus NV, Byju’s had previously embarked on a global acquisition spree before encountering the challenges of a tech funding downturn. Noteworthy participants in the upcoming share sale include existing shareholders, such as the Chan Zuckerberg Initiative, General Atlantic, and Prosus NV. Byju’s endeavors to rebuild its business amid the financial restructuring, emphasizing innovation in education technology. The company’s proactive measures highlight the resilience of Byju’s leadership in adapting to market dynamics while ensuring a sustainable future for the prominent education technology firm.