Indian ed-tech giant Byju's has sued its lender, Redwood, an American investment management company, and its affiliates in the New York Supreme Court.

Byju’s alleges that the lender has demanded “high-handed” repayment of a $1.2 billion Term Loan B (TLB) after the company missed a quarterly interest payment of about $40 million that was due on 5 June.

Redwood had been scheduled to receive its interest payment on 25 May under the contract, with a grace period until 5 June.

An Economic Times report confirms that Byju's arranged the $1.2 billion term loan in November 2021, before the ed-tech sector was hit by the pandemic.

Byju's had intended to use the loan to finance its potential global acquisitions.

According to Byju’s, Redwood has continually increased its exposure in TLB and acquired a sizeable stake in it with the intent of earning windfall gains.

Consequently, Byju’s has been forced to file a lawsuit against Redwood's "predatory tactics."

The Bengaluru-based company has alleged that Redwood has resorted to such strategies to disqualify the lender and prevent any further predatory actions by the company.

Byju’s has also said that it would not make any further payments to the TLB lenders until the dispute is resolved in court.

The company said it had taken this decision after several weeks of continued negotiations with the lenders to finalise new terms for the disputed loan agreement reportedly failed.

The ed-tech company has also said that it remains open to discussions with the TLB lenders and is ready, willing, and able to continue making payments under the TLB if the lenders withdraw their "ill-conceived actions" and honour the terms of the agreement.