Byju’s, the world’s most valuable edtech startup, has sought more time from creditors to renegotiate an agreement governing a $1.2 billion loan that is in breach of covenants, according to people with knowledge of the matter.

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The creditors have until Tuesday to sign a forbearance agreement, which will give the company time till Feb 10 to negotiate broader terms on the term loan, the people said, asking not to be identified as the information isn’t public.

Byju’s hadn’t met the deadline to disclose financial results for the year ended March 31, they said.

Byju’s is scrambling to appease creditors and investors already concerned about mounting losses at the once high-flying startup. The India-based firm has offered to raise fresh equity capital and provide creditors a so-called quality of earnings report and cash verification statements by external auditors, the people said. Reworking the agreement requires approval from a simple majority of lenders, they added.

A representative for Byju’s didn’t respond to an email seeking comment.

Some of the creditors are seeking quicker repayment of the loan using cash reserves of about $850 million from Byju’s’ US unit after the parent missed a September deadline to disclose the earnings, Bloomberg reported last month. Any accelerated repayment will be a setback for the company struggling with steep losses and meeting its cost reduction targets.

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The loan was indicated at 81.9 cents on the dollar on Monday, according to data compiled by Bloomberg. Lenders who bought the debt from primary holders in September, when the loan slumped to a record 64.5 cents, were seeking to profit from accelerated repayment, people had said previously.

The loan, priced at 550 points over Libor in November 2021, is one of the largest unrated term loan B offerings ever from a new-age company worldwide, according to JPMorgan Chase & Co., one of the deal’s bookrunners.

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