According to reports, Byju's three-year arrangement with footballer Lionel Messi as worldwide brand ambassador has been put on hold. The development occurred a year after the corporation struck a contract with the footballer.
BYJU's announced in November 2022 that it has signed football player Lionel "Leo" Messi as the first global brand ambassador for its social impact arm, "Education For All."
Byju’s to cancel the deal with Messi?
BYJU's had stated in an official statement at the time that Messi was the captain of the Argentina national football team and a player for Paris Saint-Germain. He and BYJU's had inked a contract to advance the cause of fair education.
But a year after the agreement, rumors circulated that the three-year agreement had been shelved. The football player Messi was signed on for between $5 and $7 million annually. According to an executive cited in the report, Byju paid Messi for the first year of the contract. It is unclear, though, if Byju intends to renew the agreement over time or if it would end before its entire duration.
"This is because of the liquidity crisis and other serious issues within the company," one of the executives stated. There has been no response from Byju's yet.
When Shah Rukh Khan's endorsement deal with the company expired in the middle of 2023, the Bollywood actor declined to extend it either. Industry executives reportedly stated that Khan did not want to be connected to the site because of its ongoing regulatory scrutiny, therefore this was a mutual agreement.
Image Source: Reuters
Byju's under trouble
According to sources cited by news agency PTI, on January 25, this year, the bulk of lenders involved in the $1.2 billion Term Loan B (TLB) obtained by BYJU'S filed an insolvency petition with NCLT Bangalore against the business. The claims were then refuted by BYJU'S as "premature and baseless."
As to the PTI report, the lawsuit was brought by Glas Trust Company, which stands for more than 80% of the lenders involved in the TLB loan, which is approved by institutional lenders rather than banks.
The news broke when BYJU's stated that they were in talks with the TLB lenders to pay off the whole debt with money raised from the sales of a few subsidiaries.
Image Source: X(Twitter)/multiple sources
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