Byju’s investors vote to oust Raveendran, recast board | India News

Feb23,2024


Mumbai: byju's management and its investors The parent of embattled edtech startup Think & Learn is at loggerheads with a group of investors who are voting to oust founder Byju. Ravindran As CEO and restructuring plank including his wife Divya Gokulnath and his Brother Riju Ravindran,
The announcement from investors, led by Prosus, came hours after it emerged that a group of four investors had moved the Bengaluru bench of the National Company Law Tribunal, citing “harassment” against the founders for running the entity. There was a demand for his disqualification. They want the tribunal to order the appointment of a new CEO and board and declare the $200 million rights issue void.
The petition, signed by Prosus, General Atlantic, Sofina and Peak was filed to preserve.” “, investor sources said.
“At today's EGM, shareholders unanimously passed all the resolutions put to vote. These included requests for resolution of Byju's outstanding governance, financial mismanagement and compliance issues; restructuring of the board of directors so that it is no longer controlled. Prosus said in a statement on Friday, “The founders of T&L (Byju's parent company Think & Learn) and the change in leadership of the company. These investors collectively hold more than 60% stake in the firm in favor of Voting was done.
Responding to this, Byju said that the resolutions passed during the EGM, which it claimed was attended by a small group of select shareholders, were invalid and ineffective. “These resolutions were voted on without validly constituting the quorum as stipulated in BYJU's Articles of Association (AOA). Since the founders did not attend the meeting, the quorum was never validly established, leading to the resolution Became invalid.” Said, adding that they lacked the necessary authority to impose any liability on Byju or its directors.
Byju also said that it has not received any formal information about any petition being filed in NCLT. A company spokesperson said, “If any such petition is filed, the company will respond to it in accordance with applicable law and due process.”

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Earlier this week, the startup managed to get temporary relief from the Karnataka High Court, which passed an interim order stating that any decisions taken by shareholders at the EGM will not be “given effect” until the case is heard on March 13. must be given.
“As shareholders and significant investors, we are confident of our position on the validity of the EGM meeting and its conclusive outcome, which we will now present in the Karnataka High Court in accordance with due process,” Prosus said.
Byju's, once a high-flying startup, has lost the confidence of its investors following a series of financial and corporate governance lapses in the company. Through the NCLT petition, the investors are also seeking a forensic audit and a direction to the company against any corporate action that would adversely affect the rights of investors.
In their lawsuit, investors have raised concerns about the “oppressive nature” of the rights offering, losing control of its profit-making test-prep unit Aakash Educational Services due to financial mismanagement by the founders, regulatory non-compliance and “oppressive” . Opaqueness and deliberate omissions in sharing information with stakeholders. They have also highlighted long-standing corporate governance issues, including non-appointment of a CFO and independent director and default in term loan B payments.



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