[ad_1]
BENGALURU : Byju Raveendran, CEO of India’s once most valued startup Byju’s, assured employees that he retains control of the company he founded and plans to defy the shareholders who voted to oust him.
“Contrary to what you may have read in the media, I remain CEO, the management remains unchanged and the board of directors remains the same,” Raveendran said in a letter to employees on Saturday. “I will not accept any of these accusations.” will stand down and challenge these illegal and harmful actions.”
Byju’s has deemed the extraordinary emergency meeting held on Friday, in which shareholders also voted in favor of reconstitution of the company’s board of directors, invalid. The meeting was attended by at least two dozen investors, including Prosus Ventures, General Atlantic, Chan Zuckerberg Initiative and Peak XV Partners.
These developments further underline the turbulent relationship between Byju’s and its investors after the troubled edtech company announced a $200 million rights issue that will dilute non-participating investors’ shareholding by 99%.
On Thursday, these investors, supported by Tiger Global and Owl Ventures, filed a petition in the National Company Law Tribunal against Byju’s rights issue worth $200 million, the alleged deletion of the rights of the investors, exceptional governance, financial mismanagement and other compliance issues at Byju’s.
They also called for a reconstitution of the board of directors so that it is no longer controlled by the founders of (Byju’s parent company, Think and Learn Pvt. Ltd), and a change in the company’s management.
“To emphasize again, the rumors regarding my dismissal have been greatly exaggerated and highly inaccurate,” Raveendran said in his letter, adding that “claims made by a small group of select minority shareholders that they unanimously passed the resolution in the Extraordinary General Assembly are completely erroneous.” “.
He added that only 35 of 170 shareholders, or approximately 45% of shareholders, voted in favor of the resolutions at the meeting, calling the Extraordinary General Meeting a “farce”.
Netherlands-based Prosus is Byju’s second-largest shareholder, with more than 9% stake. Prosus, General Atlantic, Peak XV and the Chan Zuckerberg Initiative own a combined 30% stake in Think & Learn. Raveendran and his family own around 23%.
Raveendran argued that the EGM lacked an “adequate quorum” requiring the presence of at least one founding director as per the company’s articles of association. He added that there were “numerous other irregularities and procedural deficiencies” that invalidated the resolutions adopted by “a select and small group of shareholders.”
Byju’s rights issue is planned at a pre-money valuation of $20 million, a far cry from the company’s peak valuation of $22 billion a few years ago, when Raveendran was considered the poster child of the Indian business ecosystem .
Meanwhile, according to Byju’s, the Karnataka High Court has granted interim relief to the company stating that any decision taken at the EGM will not come into force until it is resolved.
Unlock a world of benefits! From informative newscasts to real-time stock tracking, breaking news and a personalized newsfeed – it’s all here, just a click away! Sign in now!
See all corporate news and updates on Live Mint. Check out the latest action on Budget 2024 here. Download the Mint News app for daily market updates and live business news.
More less
Posted: Feb 24, 2024, 09:21 pm IST