Shareholder Vote at Byju’s
The majority of Byju’s shareholders recently voted unanimously to remove founder CEO Byju Raveendran and his family from the board due to alleged “mismanagement and failures” at the once-thriving Indian tech startup. However, the company contested the validity of the vote, claiming it was ineffective without the presence of the founders.
Absentee Founders and EGM Outcome
Founder CEO Raveendran Byju, along with his wife and brother, who currently constitute the entire board, abstained from the extraordinary general meeting (EGM) initiated by a group of six investors holding more than 32% in Think & Learn (T&L), the firm behind Byju’s. Over 60% of shareholders voted in favor of resolutions, including management removal, board reconfiguration, and a third-party forensic investigation into the company’s acquisitions.
Investor Statements
Prosus, one of the initiating investors, confirmed that shareholders unanimously approved all resolutions addressing governance, financial mismanagement, and leadership change at Byju’s. The resolutions aimed to resolve governance issues, reconstitute the board, and change the company’s leadership.
Legal Action and Investor Demands
Investors have filed a plea before the NCLT seeking a forensic audit, declaring the current management unfit to run the company, appointing a new CEO and board, and voiding a recent $200 million rights issue. The petition, supported by multiple investors, including Tiger and Owl Ventures, aims to safeguard investor rights amid corporate turbulence.
Challenges Faced by BYJU’S
In the past year, Byju’s encountered various setbacks, including auditor resignation, lenders initiating bankruptcy proceedings against a holding company, and a U.S. lawsuit disputing loan terms and repayment. From a valuation of $22 billion in 2022, the company’s recent rights issue valued it at $200 million, indicating significant challenges ahead.
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