Prosus writes off its 9.6% stake in Byju’s; marks $493 million loss

In its annual report, Prosus, a Dutch-listed technology investment firm, has written off its 9.6% stake in the struggling edtech company Byju's. The group attributed the write-off to a "significant decrease in value for equity investors," recognizing a fair value loss of $493 million in other comprehensive income for the current year.
According to an ET report, this move aligns with an earlier HSBC note, which assigned zero value to Prosus' nearly 10% stake in Byju's, citing multiple legal cases and funding challenges.HSBC had previously valued the stake by applying an 80% discount to the latest publicly disclosed valuation.
Over the years, Prosus has invested $500 million in Byju's, making it one of its largest edtech bets in India. However, the investment has since turned sour. In addition to the Byju's write-off, Prosus has also marked its investment in Primrose Hill (ZestMoney) to zero, as compared to $38 million in the previous fiscal year.
The write-off comes amidst ongoing legal troubles for Byju's. The National Company Law Tribunal (NCLT) has prohibited the edtech firm from proceeding with its second rights issue, directing it to maintain status quo in its shareholding. Byju's has filed a petition with the Karnataka High Court challenging the NCLT order, with the matter scheduled for hearing on Monday.
Prosus is also engaged in a legal battle with Byju's in the Karnataka High Court, following the edtech firm's petition against a group of investors seeking the removal of CEO Raveendran from the company. Both matters continue to be heard, further complicating the legal issues faced by the Peak XV Partners-backed company.